When we create a collection with xml file size of 10MB the collection size is going upto 20MB which is exactly double and some time more than double the size of xml dcuments

Do you talk about the size of the database? The only way to reduce its size is to drop index structures you don’t need in your queries. The info view and, possibly, experiments, will help you to find out which index structures are utilized.

Also is there a way where we can extract the added xml documents from collection.

Please read our documentation first (http://docs.basex.org → "Export" or similar).