My technical team proposed new features than the initial requirements. How do I communicate the same to my sponsor ensuring he is kept satisfied?
You communicate honestly. It's obvious telling your sponsor and other stakeholders good news keeps them happy but you can get the same results with honest, early, and transparent communications when you report bad news. Set up a meeting, inform your sponsor your findings in a factual, non-emotional way, explain your findings around causes, report various alternatives including the features offered up by your team, explain the plus and minuses of these alternatives to your sponsor's business, and ask for a decision. Nothing is certain about projects except this: change. If the first requirements are not working, change them and keep going.