We study phase transition in a binary system of monodisperse active and passive particles. The particles are initially randomly positioned inside a fixed boundary square enclosure. The active particles can move with their self-propulsion force. Whereas, the passive particles do not have any self-propulsion force, and they move by the spatial interactions with other particles. An alignment force in our discrete element model causes the emergence of collective milling motion. Without this alignment interaction, the particle system remains in a disordered phase. Whereas, the ordered milling phase is attained after achieving a minimum coordination among neighboring particles. The phase transition from disordered to ordered depends upon the relative effect of self-propulsion and the alignment, initial states of the particles, noise level, and the fraction of the active particles present in the system. The phase transition we observed is of first-order nature. ©2020 American Physical Society.