You have always seen your mother boil the milk and then cool it down. What is the process known as and what is its significance?

The process is called Pasteurization. Pasteurization is the process of heating milk up and then quickly cooling it down to eliminate certain bacteria. For effective pasteurization, milk can be heated upto 145 degrees Fahrenheit for 30 minutes.
Pasteurization was developed by Louis Pasteur in 1864. Pasteurization destroys microorganisms that can appear in milk and cause illnesses, such as tuberculosis, typhoid fever, scarlet fever, sore throat, diptheria and gastrointestinal ailments. It's also meant to counter organisms that lead to the souring of milk. The process involves heating the milk to temperatures between 150 to 300 degrees Fahrenheit and then cooling it. Pasteurization kills dangerous germs, but it also destroys beneficial bacteria and other nutritious constituents.
Because pasteurization destroys bacteria that cause souring, pasteurized milk has a longer shelf-life than raw milk. Powdered milk's shelf life is even longer than liquid milk and it does not require refrigeration. However, powdered milk does not last forever, as its fats eventually turn rancid. While powdered milk lasts longer in storage, it does require the extra step of adding water before use, and once water is added to powdered milk, the shelf-life is the same as for liquid milk.