Micro turbine generators are often used these modern days as distributed energy resource which is connected to distribution system. The main reason using micro turbine generators operated with waste fuels suiting most of the industrial loads of small scale to medium due to advantages like compact size, high speed, good efficiency, less maintenance, low emissions. Permanent magnet turbo generators are required to couple with the micro turbine. The generated output power from turbo PM generator is of high frequency, so AC/DC/AC converter is been used to convert the output AC power of high frequency into the grid frequency for grid interconnection. A huge increase in the loss and temperature of high speed machine is been noticed especially due to the high frequency harmonic currents produced by the power conversion system. This paper presents a multifunctional three phase active power filter(APF) which is used as PWM inverter to start micro turbine and then it is used as active power filter to mitigate current harmonics produced by AC-DC converter. A Synchronous reference frame(SRF) theory based control strategy is implemented for both PWM inverter and active power filter. The complete system is modeled and simulated in Matlab/Simulink software. © 2017 IEEE.