What's the use of neutral wire in single phase home supply?
Why use three wires Live, Neutral and Ground?

With only two wires, you would have to use the neutral for &quot;earthing&quot; the metallic part of the equipment. I'm thinking of cookers, refrigerators, Hi-Fi, iron etc..
You do this because should the internal live wire break and unexpectedly touch the appliance metal case, you want a significant &quot;earth&quot; current to flow and blow the fuse thus revealing a dangerous situation.
However, with only two wires, if live and neutral got swapped the problem would not be self-revealing and would be highly dangerous to anyone coming into contact with the case of the equipment. The equipment would appear to work but be highly dangerous because the exposed metal parts of the case are at live potential.
With a third wire (specifically an earth wire), if the wiring to the plug got messed up and live and neutral got swapped, the third earth wire is still connected to the exposed metal parts of the case and there wouldn't be a safety issue. In all likelihood the equipment would still operate correctly but is still safe.
If neutral and earth got inadvertently swapped, again there should be no real safety issue because the neutral wire that is incorrectly connected to the exposed metal parts would still be able to &quot;earth&quot; those exposed metal parts and, safety is preserved.
If live and earth got messed up then this is a self revealing fault because the equipment could not operate with neutral and earth connected to where neutral and live would normally go. It's not great but it is self-revealing and relatively safe. Of course with modern day gizmos like residual current devices (RCD), those exposed metal parts that are improperly connected to live would likely trip the RCD.
First and foremost it's about safety.