According to the VFS checklist http://pt.vfsglobal.co.in/pdf/TOURIST-VISA.pdf a notarized Sponsorship Letter is REQUIRED.
If the applicant is sponsored by another person, an original Sponsorship Letter is required on Rs. 100 Stamp Paper and must be Notarized. If the Sponsor is in not in India, the Sponsorship Letter should be Notarized/Attested by a Notary/Advocate if in the E.U. or from the respective Portugal Consulate/Embassy in other countries.
As it states at the bottom of the checklist, failure to submit a required document may result in a refusal. Sponsorship proof is a critical element of demonstrating sufficient funds; without it, your chance of approval is likely to be much reduced. The Consulate may ask you for it, or they may just decide to refuse. You should get the Letter and contact them to find out how you can correct the error.