Theory:

     “Of course not. It’s there on the tree. Let’s swim back at once and get it. Your wife must be waiting,” replied the monkey gaining confidence.
 
     “Oh dear! What a mistake!” hissed the crocodile. They laughed loudly as the crocodile took a full turn to reach the tree.
 
     On the river-bank, the monkey jumped on to the tree and heaved a deep sigh of relief. He plucked a fruit or two from the nearest branch and throwing them down said, “Let your wife have some fruit rather than my heart. Fresh fruits are good for mind and body. Good bye, friend, and if you don’t mind, we won’t meet again.” The crocodile, sadder and wiser, shed a few tears which were genuine and turned back to go home. He was in a hurry to tell his wife a thing or two.
Explanation:
 
The monkey's trick started to work. The smart monkey started to play its game. It told the crocodile that it kept the heart on the monkey's tree itself where the monkey resides. It also said that the monkey and the crocodile should go back to the monkey's place to get the heart. Otherwise, the crocodile's wife would be kept waiting for them. The monkey is confident of its plan.

The foolish crocodile trusted the monkey. It felt terrible for the mistake it committed and made a hissing sound. The monkey and the crocodile laughed at the crocodile's mistake and turned back towards the monkey's tree. Then, both reached the monkey's place. The monkey jumped on to the tree; took a long breath and relaxed for a while.

Then, the monkey plucked a few fruits from the nearest branch and threw it down to the monkey. Having offered those fruits, it told the crocodile that it was for his wife. The monkey also satirically mentioned that his wife could have those fruits instead of the monkey's heart; after all, fresh fruits are good for mind and body.

Having said these, the monkey bade his friend a goodbye and politely informed the crocodile not to meet him again. The crocodile understood its fault. It cried on having lost such a great, loyal friend. Though the tears are genuine, nothing can restore their friendship. It started home regretting for having supported his wife. Around this time, the crocodile gained wisdom and confidence to discuss with his wife.
 
Meaning of difficult words:
 
S.No
Words
Meaning
1.
Hiss
To make sound like a long 's'
2.
Reside
To live in a particular place
3.
Heave
To move up and down 
4.
Sigh
To take a long breath
5.
Relief
A feeling of happiness when some unpleasant thing stopped or does not happen
6.
Genuine
Real or original
Reference:
National Council of Educational Research and Training (2006). The Monkey and the Crocodile (pp. 20-24). Published at the Publication Division by the Secretary, National Council of Educational Research and Training, Sri Aurobindo Marg, New Delhi.