When 1500kVA DG Set 415V was started on no load (Breaker open)following voltages were observed. DG Neutral is unearthed.
RY - 414V
YB - 415V
BR - 415V
RN - 230V
YN - 230V
BN - 229V

RE - 324V (R phase to Earth)
YE - 325V (Y phase to Earth)
BE - 324V (B phase to Earth)
NE - 203V (Neutral to Earth)

It is observed that neutral is having 200VAC with respect to Earth. On trying to solidly earth the neutral small spark (200mA) was observed. Phase to earth voltage is coming down to 230V on solidly grounding the neutral. What could be the reason.

Thanks for your help.

 

A small spark, some current is entirely possible without any insulation or isolation fault. A voltage can be developed through capacitive or inductive coupling.

Measure the neutral to earth voltage using a low impedance voltmeter or connect a 240V lamp in parallel. It is quite possible the neutral to earth voltage you are measuring is phantom or ghost voltage, as it is commonly called in the electrical industry. Google the term.

200mA is far from excessive with a 1.5mVA source... IMO.

 

That was supposed to be 1.5<b>M</b>VA.