One rupee Indian coin is called "limited legal tender" because

Limited legal tender is that money which no person can be forced to accept beyond a certain maximum limit fixed by law. For instance in India, coins are limited legal tender because coins of 5, 10, 20 and 25 paise can be accepted up to maximum sum of र 1000 as per Coinage bill passed on 11th Aug. 2011. One can refuse payments by an individual in these small coins beyond this limit.

In India, coins function as limited legal tender. Therefore, 1 Rs coins can be offered as legal tender for dues up to ₹10 and smaller coins for dues up to ₹5.