Great discussion, Mohssin. On the surface, the question "What is vocabulary?" sounds rather stupid: of course, vocabulary = words! But seeing a sentence and only recognising the individual words is like seeing a car and only recognising the individual pieces of metal, glass, etc.
The underlined part in my previous example is a perfect example of a fixed phrase. One can say "on the surface", but it's wrong to say “on the top", "on the outer layer", etc. even though those words are technically synonyms for "surface".
There's a philosophy of language learning developed by Michael Lewis called "The Lexical Approach" which posits that all language exists in "chunks", and we should learn the chunks in which words appear, rather than the words themselves. For example, consider the sentence "I'll give you a call later this evening about the bus schedule for tomorrow's class field trip", and notice how the individual words are almost all totally enmeshed inside common collocations and set phrases:
I'll give you a call
later this evening
class field trip
The sentence becomes much easier to understand when broken into 4 chunks, rather than 17 words.
Since chunks exist at the lowest levels of language (eg. "I don't like"; "Could I please have"), as well as high levels (eg. "further illustrate my argument"; "relevant to the current situation"), learning language chunks is something every language learner should be doing. They're the key to natural communication.