Hi Prachi,
Content Document: It Represents a document that has been uploaded to a library in Salesforce CRM Content or Salesforce Files. The maximum number of documents that can be published is 30,000,000. This object record you don’t have to create. It gets created when you create ContentVersion which is the child of ContentDocument.
Content Version: Represents a specific version of a document in Salesforce CRM Content or Salesforce Files. In other words, this object stores document information similar like Attachment.
Now have a look on the relationship between these two objects below-

Now ContentDocumentLink: This object will share the files with Users, Records, Groups etc. You can create multiple records to attach the same files under multiple records.