What is the way to use a readymade double boiler with whistle? I have purchased this double boiler.

It is written that we have to fill water after opening the whistle. 
How much water am I supposed to fill?  How do I know that?

I filled it completely with water. Then it blew the whistle. Now how I am supposed to know that milk has boiled completely or it has just heated up? 

How do I know whether it has boiled enough to kill the germs?
You are supposed to fill enough water such that you can heat the milk well, but not fill it to the top - you need a bit of space for steam to build up so the whistle will work. Fill it to a height somewhere half between the milk height and whistle height, you don't need to be exact though. 

When the whistle blows, the water will be at full boil, so 100 Celsius. The steel of the inner vessel is quite efficient in conducting that heat, so the milk will be close to 100 Celsius, but not at 100 (that's why it doesn't boil over). I don't know the exact temperature and don't have tables for pasteurization times in this range, so in this case, you have to trust that the manufacturer has checked these tables, tested the product, and ensured that the milk is safe at the temperature reached in its pot.