The bench of Chief Justice Indira Banerjee and Justice M Sundar modified the Madurai bench's interim order which had stayed the government order on the ground of procedural lapses in appointing new law officers.
It said the earlier order would cause serious prejudice to the litigants.
The government pleaders and public prosecutors whose appointments had been terminated may continue to represent the state until further orders unless otherwise directed, the first bench said.
The bench then posted all other related matters to July 31.
Earlier, Advocate General R Muthukumaraswamy representing the state government submitted that the Madurai bench order has given rise to an impasse in various districts since the appointments of new law officers and public prosecutors have been stayed, while the disengaged public prosecutors and law officers too cannot appear.
The matters in which the state was a party could not be heard as it went unrepresented, he pointed out.