You have threatened to severely punish a potential successor to one of the most powerful member of the empire's loyalists faction and you call it a "test"? Even if Shuli managed to prevent Jeremy's hand from getting cut off, who would trust a royal family that would punish a loyal follower this severely?
And why can't the crown prince just pardon Jeremy, he's literally the victim, it would show benevolence by the crown prince and it avoids the most dire situation. Sure, it might make it look like the royal family is weak but at least it doesn't end up with outright hostility between a member of the council and the royal family.