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Seeing is simply having a look on the object/subject. You can say that it is a bird’s eye view only. But when observation comes into the picture then one needs the in-depth analysis on the same object/subject.
For example, one can see a car standing at a point but one cannot come to a conclusion that the car is operational or not unless an thorough observation is made.
to see something that means that your eyes have received the reflected lights off an object
to observe somthing that means that have first to seen it then contemplated on the objects
actions and motives