The following questions may be posed. As long as the liberated soul is in contact with the body, why don’t the bodily activities affect him? Doesn’t he actually become contaminated by the action and reaction of material activities? In answer to such questions, this verse explains that the material body of a liberated soul is taken charge of by the Supreme Personality of Godhead. It is not acting due to the living force of the living entity; it is simply acting as a reaction to past activities. Even after being switched off, an electric fan moves for some time. That movement is not due to the electric current, but is a continuation of the last movement; similarly, although a liberated soul appears to be acting just like an ordinary man, his actions are to be accepted as the continuation of past activities. In a dream one may see himself expanded through many bodies, but when awake he can understand that those bodies were all false. Similarly, although a liberated soul has the by-products of the body–children, wife, house, etc.–he does not identify himself with those bodily expansions. He knows that they are all products of the material dream. The gross body is made of the gross elements of matter, and the subtle body is made of mind, intelligence, ego and contaminated consciousness. If one can accept the subtle body of a dream as false and not identify oneself with that body, then certainly an awake person need not identify with the gross body. As one who is awake has no connection with the activities of the body in a dream, an awakened, liberated soul has no connection with the activities of the present body. In other words, because he is acquainted with his constitutional position, he never accepts the bodily concept of life.
Source: A.C. Bhaktivedanta Swami Prabhupada (2014 edition), “Srimad Bhagavatam”, Third Canto, Chapter 28 – Text 38