illustration (attribution, if any possible, is at the end of the article)
Paññātti refers to 'concept' / 'view',
while dhamma refers to "atom of experience", or 'phenomenon'.
Only dhammas may be 'ultimately' real.
There are two (inseparable) aspects of paññātti, nāma-pannatti and attha-pannatti:
• Nāma-pannatti is a 'designation' (or name), it is a mere label pointing to an object;
• Attha-pannatti is the 'meaning' associated, and it is actually the object the name is pointing to.
Both aspects co-dependently exist.
In principle, anything which can be discriminated can be named, hence nāma-pannatti could point to a dhamma.
An Enlightened mind has the ability to "see things as they are", hence the Buddha could 'see' dhammas, without any added layer of meaning.
But once the Buddha 'designates' the dhammas to talk to others, meaning has to enter the scene. This could be linked to the understanding of sabhava ("intrinsic nature", gplus.wallez.name/8gEEPXJpAp6) as the 'meaning' (characteristics, functions, ...) attached to a dhamma.
But cognition in the Abhidhamma very much refers to the aggregated cumulative result of cognitive mental events, and the ordinary mind cannot but add layers of meaning over dhammas.
At the end of the day, 'fire' or even 'this fire' refers to what the ordinary mind 'imagines' the observed dhamma to be, rather than the dhamma itself.
The difficulty for the ordinary mind is its inability to even 'see' without automatically adding paññātti (as if terrified by not-knowing), the difficulty is in confusing 'realising' and 'verbalising'.
Paññātti is at the core of the 'reifying' difficulty of the ordinary mind: the projection of entity-ness and permanency.
It is to be noted that paññātti not being real, they are not subject to what described reality... notably, paññātti is not subject to impermanence, arising, enduring, ceasing.
Paññātti is de facto out of time, and even out of causality. This again easily points to the reifying ordinary mind: the concept of 'fire' is very much conceived out of time. Real fire (dhamma) arises, endures, and ceases.
Being out of causality explains why we can have "wrong views": causality cannot 'naturally' or 'automatically' correct such wrong views.
Moreover, not being ultimately real, paññāttis are not positively produced, they do not arise from conditions and circumstances, they are not 'anchored' in reality (for better or for worse).
Paññātti is the result of the mind's synthesising function.
It may be noted that the parable of the raft may be interpreted as a general lack of trust on paññātti: even the deepest teachings of the Buddha have to be left behind once on the other shore.
One of the reason is the lack of 'anchoring' into reality: ignorance (preferences, biases, habits...) plays a key role in which 'views' we appropriate as ours. Paññātti cannot be relied on to actually point to reality directly, the overlay of meaning immediately appears.
This "cannot be relied upon" explains why Nibbāna is un-conditioned: there is no speech that will warranty Awakening!
Even ultimate truths (i.e. truths expressed in ultimate terms, i.e. truths expressed in terms of dhammas) are mere constructions: we easily attach meaning to 'impermanence', a meaning out of time. And if we cling to such a view, the clinging will invariably lead to suffering.
'Ignorance', the root cause of suffering, can be interpreted as the confusion between paññātti and dhamma.
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