Theory:

     Now the king was angry. He thundered, “Why do you always carry that iron chest with you? What does it contain?”
 
     The governor smiled. He asked his servant to bring in the chest. How eagerly the people standing around waited for the shepherd to be found out! But how great was their astonishment, and even of the king himself, when the chest was opened! No gold or silver or jewels but an old blanket was all that came out. Holding it up proudly, the shepherd said, “This, my dear master, is my only treasure. I always carry it with me.”
Explanation:
 
While looking at the shepherd arriving with the iron chest to the palace, the king became angry. He shouted at him, asking, “Why do you always carry that iron chest with you? What does it contain?”
  
The angry king.jpg
The angry king

The new governor smiled for some time. Then he asked his servant to bring in the iron chest. Since the people gathered in that place were more interested to know the hidden thing inside the iron chest, they eagerly awaited it to be unveiled. The governors who complained about the hidden treasure inside the iron chest were more curious to know the secret behind it.

When the shepherd opened the iron chest, everyone, including the king, was surprised and shocked. The reason behind this was that the iron chest did not contain any gold, silver, or jewels. Instead, there was an old blanket inside it. Now the false stories regarding the iron chest came to an end. The governors did not know how to react but felt sad and disappointed. On the other hand, the humble new governor proudly replied to the king, “This, my dear master, is my only treasure. I always carry it with me.
 
Meaning of difficult words:
  
S.No
Words
Meaning
1.
Thundered
To make a loud noise like thunder
2.
Eagerly
Keenly expecting something
3.
Blanket
A thick cover made of wool used on bed to keep it warm
4.
Unveil
To remove something from the cover
Reference:
National Council of Educational Research and Training (2006). The Shepherd's Treasure (pp. 07-10). Published at the Publication Division by the Secretary, National Council of Educational Research and Training, Sri Aurobindo Marg, New Delhi.