Hi Taheera
I think the problem isn’t in the shadows, but in the light source. In your first example, you are illuminating the scene with a light that is just a point in the space (such as a single bulb). But in the second example, the source of light is a surface, such as a window with curtains, or a photographer’s softbox… This way, as the light is a surface, the shadows are smoother.
First of all, you have to replace the light in your scene with a VRay light with a rectangular shape (or a disc). For example, a light with a size of 0,50x0,50m. You can test different sices and different intensities. Then, you can deal with the parameters of the light to get a smooth shadow.