The passive voice of 'People distributed books in the village school' is 'Books were distributed in the village school by people.', with 'people' being optional.
To change the sentence "People distributed books in the village school" to the passive voice, you would say: "Books were distributed in the village school by people."
When changing to passive voice, the object of the active sentence ('books') becomes the subject of the passive sentence, and the subject of the active sentence ('people') is now optional and, when included, follows 'by'.
It's worth noting that in English, the passive voice can sometimes omit the doer of the action when it's not important or already understood.