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It is a topic expounded in:
In several instances, "reality" refers to "ultimate truth". You will find it so meaning in expressions such as "concealing reality", "seeing reality", "understanding or ascertaining the meaning of reality". It seems it is also how Sankha Kulathantille understood it, since he gave the Vaibhashika definition of ultimate truth.
I will indicate how Geluk presentations of tenets (grub mtha') define ultimate truth in relation to different philosophical school. My main sources here are Jetsun Chokyi Gyaltsen's Presentation of Tenets and Geshe Sopa's Cutting Through Appearances. These sources are more "doxographical" than they are philosophical.
Vaïbashika definition [of ultimate truth] : A phenomenon that is such that, if it were broken or mentally separated into parts, the mind apprehending that object would not cease. Ex.: directionally partless particles, temporally partless moments of consciousness, uncompounded space, any of the five aggreegates.
Sautrantika definition: A phenomenon that is able to perform a function ultimately. Ex.: Any impermanent phenomenon.
(That is to say an appearing object of a conceptual consciousness is not an ultimate truth, and a conceptual consciousness is necessarily mistaken with regard to its appearing object)
Cittamatrin definition: That which is realized by means of a valid direct perceiver that realizes it clearly without dualistic appearance. Ex.: An emptiness that is a form and its form-apprehending valid cognizer’s emptiness of being other substances, and an emptiness that is a form’s emptiness of existing by way of its own characteristics as a base for assigning the term ‘form’.
Madhyamika-Svatantrika definition: An object that is realized in a non-dualistic manner by the direct valid cognizer that directly realizes it. Ex.: A pot’s emptiness of true existence.
Madhyamika-Prasangika definition: An object which is found by a valid cognizer analyzing the final mode of existence and with respect to which a valid cognizer analyzing the final mode of existence become a valid cognizer analyzing for the final mode of existence. Ex.: A pot’s emptiness of inherent existence.
The Prasangika stand is, in brief: anytime a conventional truth appears to the mind of a sentient being (i.e. a non-buddha), it appears together with the appearance of inherent existence. Thus, all conventional cognizers in the continuum of a sentient being are mistaken with regard, not to the thing, but to the mode of existence [of things]. Innate ignorance is the mistaken conception of true existence that conceals reality (i.e. emptiness which is the absence of inherent existence) and is the opposite of wisdom directly realizing emptiness (which is the absence of inherent existence).
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There are 3 groups of peoples are there.
1). Prisoners ( world of faculty's)-Believe perception.
Plato has Socrates describe a gathering of people who have lived chained to the wall of a cave all of their lives, facing a blank wall. The people watch shadows projected on the wall from things passing in front of a fire behind them, and they begin to give names to these shadows. The shadows are as close as the prisoners get to viewing reality.
2). Philosophers (world of sankara) - Believe Reality.
He then explains how the philosopher is like a prisoner who is freed from the cave and comes to understand that the shadows on the wall do not make up reality at all, for he can perceive the true form of reality rather than the mere shadows seen by the prisoners.
3). Those who escape from the cave.(Buddhists who liberated from the samsara)
Nirvana - Beyond the world - who can see through the reality.
Socrates remarks that this allegory can be taken with what was said before, namely the analogy of the sun and the analogy of the divided line. In particular, he likens our perception of the world around us "to the habitation in prison, the firelight there to the sunlight here, the ascent and the view of the upper world [to] the rising of the soul into the world of the mind" (517b).
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Reality is that which stays the same when you try to subdivide. They are called Paramatta Dhammas. Perception is that which changes when you subdivide the supposed object it points to.
ex: Table is a perception. If you break it into pieces, it becomes a pile of wood. It's not a table anymore. Man is a perception. If you pile up the bones and flesh separately, it's not a man anymore.