Thus whatever is known, seen, believed and experienced as a person is bound to be falsehood.

Man and his experience of the world cannot exist without waking experience. Whatever we are discussing, we are discussing within the waking experience, which is mere illusion from ultimate standpoint.  Thus whatever is known, seen, believed and experienced as a person is bound to be falsehood.

But Seeker start doubting:-

v  How could the waking  experience to be illusory?

v  One is aware of so many things happening within the waking so could it be illusory?

They raise this question taking that illusion to be something to very real. It is the phenomenal appearance of the world observed from relative standpoint, and not from that of the soul, which is the true self.

Seeker must realize the fact that even A person, who stamped his foot on the ground to refute to show the world, is real, ignore that in dream he would do exactly the same--stamp his dream foot on the ground and assert it to be real. 

The three states is mere illusion. They seem to be real, observed from relative standpoint and not from the standpoint of the soul(consciousness or spirit), which is the true self.  The three states are just like mirage.  One sees the mirage, but actually, there is no water in it, nor could he therefore quench his thirst taking water there from. 

Even those who realize the fact that, there is no water at all there, do have the optical illusion of a sheet of water therein.  In the same manner, even to the Gnani who comprehend this illusion, in all its nakedness, the plurality of this waking experience does not appear to be very real.  However, he does realize at the same time the man and the world are reality within the waking experience, but the waking is unreal.

One mistakes the world to be real. However, its reality is limited to waking experience alone. Actually, there is no waking experience.  So long as one takes the waking to be real although it is unreal, the waking experience proves efficacious enough for various activities.  Just like the reality of the dream becomes unreal when waking takes place, even so one do perceive that the waking is based on the soul which is the true self and that the soul alone is the Absolute reality, all the mundane activities would come to standstill.