Why my iphone 3g 16gb giving error 1015?

It sounds as if the software on the iPhone was modified or jail broken.

Error 1015: This is the error which is typically caused by the attempts to downgrade the iPhone, and even the iPad, or even the iPod touch's software. This can occur only when you attempt to restore using an older .ipsw file. that the reason for the trouble. Downgrading to a previous version is not supported any more. To resolve this issue, you need to attempt to restore with the latest iPhone, iPad, or even the iPod touch software available from Apple. This error can happen only when an unauthorized modification of the iOS has occurred in it and you are now trying to restore to an authorized, default state. Very rarely this error is caused by a hardware issue and requires service.

If that doesn't work you'll need to find a way to undo any previous modifications to the iPhone.