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What is the difference between self–knowledge and self–realisation? According to modern Vedānta, self-knowledge is intellectual while self-realisation is experiential, and because of this difference the study of the śāstra is meant for self-knowledge while something else will become the means for self-realisation. When the śruti is the means of knowledge to recognize the self which is always present (nitya-aparokṣa) how can there be an indirect knowledge of ātmā which has to be converted into direct realisation by some unique method?>
Śravanam, mananam and nididhyāsanam are prescribed in the śruti only for self-knowledge. The confusion of making a distinction between knowledge and realisation is caused by not recognising the invariable presence (aparokṣatvam) of ātmā in all situations and by not understanding the śruti as the means of knowledge to recognize the svarūpa of ātmā. That is the reason why we often hear that what we gather from the śruti is only intellectual knowledge. The adjective ‘intellectual’ describing knowledge will be a necessity only when there is a nasal or dental knowledge. All forms of knowledge happen in the intellect. There is no such thing as intellectual knowledge. There can be two types of knowledge: one is direct and the other indirect. When the ātmā is invariably present, the knowledge of ātmā can only be direct.
‘Teaching Tradition of Advaita Vedanta’ p18, Swami Dayananda
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Confusion also exists in the thinking that self-realisation is the elimination of all thoughts in the mind. The confusion comes from the statement that the ātmā is undivided (nirvikalpa). If absence of thought is self-knowledge, everyone is already enlightened, because who has not slept? Even between two thoughts there is absence of thought. If absence of thought for one split second is not enlightenment, absence of thought for an hour is not going to make one wiser. It is obvious that absence of thought is not enlightenment. If a thinking person does not know, how will a non-thinking person know? If there is enlightenment in the absence of thought, it will be lost no sooner than a thought occurs; therefore an enlightened person should be permanently without thoughts in order to remain enlightened. That means there will be no enlightened person at all.
The śāstra presents the ātmā as nirvikalpa. The vision of the śāstra is that while the knower, known and knowledge are not separate from ātmā, ātmā is independent of all of them. In the Māṇḍūkyopaniṣad, as well as in the kārikā (an explanation in verse), the dreamer is cited as proof that there is no real division (vikalpa) such as dreamer, dream and dreamt, even though during the dream the division was taken to be real.
'Teaching Tradition of Advaita Vedanta' p23, Swami Dayananda
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