Due to increasing power demand in the recent scenario, intensely integrated penetration of distributed generation (DG) has become need of the day. Grid-tied inverter based DG is becoming popular due to its effective controllability. However, voltage unbalance is observed sometime at the Point of Common Coupling (PCC) due to fluctuating demands of injection of active-reactive power by the DG into the Grid. This paper presents realization of two different topologies of grid tied inverter - conventional two-level three-phase four-wire, and three-level T-type Neutral Point Clamped (T-NPC) based DG, both controlled by three-phase damping control strategy. Simulation studies presented indicate effective operational control for DG based on both these topologies of inverter under various operating conditions. The primary function of DG, which is to inject power into the grid and decrease the burden on the conventional generation system is analyzed. Effective behavior of the proposed two-level as-well-as three-level DG without giving rise to voltage unbalance issue is presented in this paper. Detailed analysis of unbalance index and total harmonic distortion (THD) for PCC voltages and currents is presented. Also, performance of both the proposed DGs for fulfilling load requirement during operation in islanding mode are presented. Satisfactory voltage compensation capability of DGs is depicted from the presented results for single-phase asymmetric fault and three-phase symmetric faults. Low voltage ride through capability, reduction in unbalance index, and THD within the standard limits are the main features of the presented DG systems.