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I have a multiple entry Schengen visa issued by the German consulate in Kolkata that is valid until 26.08.2014. Does this mean I have return within 26.08.2014?

If I enter before 26.08.2014, then can I stay up to another 10/15 days?

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If you don't have any other visa, you should leave the Schengen area on the 26th of August at the latest. Schengen visas do not work like US visas in this respect.

If you want to stay after that date, you should apply for another visa. This new visa's period of validity should start on the 27th of August and you would then be able to use both visas together (provided you fulfill all other conditions). See Traveling on back-to-back Schengen visas

You should apply for this supplementary visa at the consulate serving your place of residence as it will usually not be possible to get an extension or a new short-stay visa after entering the Schengen area. If you want to travel in August, you should probably do it ASAP.

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