What is the philosophical explanation for how Sai Baba knew Sapatnekar's entire life story?

The text explains this through the lens of non-dualistic philosophy. Sapatnekar wondered how Baba could know his story, and the answer provided in Chapter 48 is that for Baba, everything was as clear as a "gooseberry in the palm of the hand." This is because Baba is described as being the "form of Brahman" and merged with the Supreme Being. For one who has achieved such a state, the distinctions of "mine" and "thine" disappear, as the entire universe is their family. The text states, "He himself is the world in detail." In this state of oneness, the duality of seer, seeing, and seen does not exist, granting him complete knowledge of everything and everyone.