UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


WASHINGTON,
D.C. 20549




FORM
10-Q






x
            Quarterly
      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
      1934for
      the quarterly period ended September 30,2008.




or




o
            Transition
      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
      1934for the
      transition period from ___________ to
      _____________ .








Commission
File Number: 000-51854






Phoenix
India Acquisition Corp.


(Exact
name of registrant as specified in its charter)





Delaware
            20-3195916(State or Other Jurisdiction of
            (I.R.S.
      EmployerIncorporation
      or Organization)
            Identification
      No.)




590
Madison Avenue, 6th Floor, New York, New York, 10022


(Address
of Principal Executive Offices including Zip Code)




(516)
428-3319


(Registrant’s
Telephone Number, Including Area Code)










Check whether
the registrant (1) has filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.   
Yes x    
No o




Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).    Yes x   
 No o




There
were 8,966,796 shares of the Registrant’s common stock issued and
outstanding as of June 30, 2008.












Phoenix
India Acquisition Corp. Index to Form 10-Q






PagePart
      I.
            Financial
      Information
            3Item
      1.   Financial Statements (unaudited)
            3Balance
      Sheets
            3Statements
      of Operations
            4Statement
      of Stockholders’ Equity
            5Statements
      of Cash Flows
            6Notes
      to Financial Statements
            7Item
      2.    Management’s Discussion and Analysis of Financial
      Condition and Results of Operations
            10Item
      3.    Quantitative and Qualitative Disclosures about Market
      Risk
            11Item
      4T.    Controls and Procedures
            12Part
      II.
            Other
      Information
            13Item
      1.    Legal Proceedings
            13Item
      1A. Risk Factors
            13Item
      2.    Unregistered Sales of Equity Securities and Use of
      Proceeds
            16Item
      3.    Defaults Upon Senior Securities
            17Item
      4T.  Submission of Matters to a Vote of Security
    Holders
            17Item
      5.    Other Information
            17Item
      6.    Exhibits
            17SIGNATURES
            17










- 2
-


PART
I - FINANCIAL INFORMATION
  Item
1 - Financial Statements
  PHOENIX
INDIA ACQUISITION CORP.
 (a
corporation in the development stage)
 BALANCE
SHEETS
  September
      30, 2008
                
                
                December
      31, 2007(Unaudited)
                
                
                (Audited)AssetsCurrent
      assets:Cash
                
                $
                —
                
                
                $
                227,322Cash
      held in trust account
                
                
                
                
                
                
                57,715,997Accrued
      interest receivable
                
                
                —
                
                
                
                116,279Prepaid
      expenses
                
                
                —
                
                
                
                13,750Refundable
      income taxes paid
                
                
                422,155
                
                
                
                —Total
      current assets
                
                $
                422,155
                
                
                $
                58,073,348Liabilities
      and Stockholders’ EquityCurrent
      and total liabilities:Accounts
      payable and accrued expenses
                
                $
                554,052
                
                
                $
                433,080Income
      taxes payable
                
                
                —
                
                
                
                671,408Notes
      payable, stockholders
                
                
                85,282
                
                
                
                —Deferred
      underwriting fees
                
                
                —
                
                
                
                2,265,500Total
      current and total liabilities
                
                
                639,334
                
                
                
                3,369,988Common
      stock subject to redemption, 1,415,2219 shares at redemption value of
      $7.65
                
                
                —
                
                
                
                11,403,213Shareholders’
      Equity:Preferred
      stock, $0.0001 par value, authorized 1,000,000 shares; none
      issued
                
                
                —
                
                
                
                —Common
      stock, $0.0001 par value, authorized 89,000,000 shares, issued and
      outstanding 8,966,796 shares
                
                
                897
                
                
                
                897Paid-in
      capital in excess of par
                
                
                —
                
                
                
                41,327,209Earnings
      accumulated during the development stage
                
                
                (218,076
                )
                
                
                1,972,041Total
      stockholders’ equity
                
                
                (217,179
                )
                
                
                43,300,147Total
      liabilities and stockholders’ equity
                
                
                422,155
                
                
                
                58,073,348
  See
accompanying notes to financial statements
  - 3
-
 PHOENIX
INDIA ACQUISITION CORP.
 (a
corporation in the development stage)
 STATEMENT
OF OPERATIONS
 Three
      months ended
                  
                  
                  Nine
      months ended
                  
                  
                  For
      the period
                    from
      July 13, 2005September
      30,
                  
                  
                  September
      30,
                  
                  
                  (inception)
      to2008
                  
                  
                  2007
                  
                  
                  2008
                  
                  
                  2007
                  
                  
                  September
      30,Revenues:Interest
      income
                  
                  $
                  —
                  
                  
                  $
                  743,667
                  
                  
                  $
                  495,001
                  
                  
                  $
                  1,472,818
                  
                  
                  $
                  5,460,926Expenses:General
      and administrative expenses
                  
                  
                  19,350
                  
                  
                  
                  120,075
                  
                  
                  
                  831,153
                  
                  
                  
                  240,447
                  
                  
                  
                  2,364,729Total
      expenses
                  
                  
                  19,350
                  
                  
                  
                  120,075
                  
                  
                  
                  831,153
                  
                  
                  
                  240,447
                  
                  
                  
                  2,364,729Income
      before provision for income taxes
                  
                  
                  (19,350
                  )
                  
                  
                  623,592
                  
                  
                  
                  (336,152
                  )
                  
                  
                  1,232,371
                  
                  
                  
                  3,096,197Provision
      for income taxes
                  
                  
                  —
                  
                  
                  
                  218,257
                  
                  
                  
                  —
                  
                  
                  
                  431,330
                  
                  
                  
                  1,460,308Net
      income
                  
                  $
                  (19,350
                  )
                  
                  $
                  405,335
                  
                  
                  $
                  (336,152
                  )
                  
                  $
                  801,041
                  
                  
                  $
                  1,635,889Weighted
      average shares outstanding:Basic
                  
                  
                  8,966,796
                  
                  
                  
                  8,966,796
                  
                  
                  
                  8,966,796
                  
                  
                  
                  8,966,796
                  
                  
                  
                  6,994,782Diluted
                  
                  
                  8,966,796
                  
                  
                  
                  14,897,217
                  
                  
                  
                  8,966,796
                  
                  
                  
                  14,858,252
                  
                  
                  
                  12,092,031Net
      income (loss) per share, basic
                  
                  $
                  (0.00
                  )
                  
                  $
                  0.05
                  
                  
                  $
                  (0.04
                  )
                  
                  $
                  0.09
                  
                  
                  $
                  0.23Net
      income (loss) per share, diluted
                  
                  $
                  (0.00
                  )
                  
                  $
                  0.03
                  
                  
                  $
                  (0.04
                  )
                  
                  $
                  0.05
                  
                  
                  $
                  0.14
  See
accompanying notes to financial statements


- 4
-
 PHOENIX
INDIA ACQUISITION CORP.
 (a
corporation in the development stage)
 STATEMENTS
OF STOCKHOLDERS’ EQUITY
 For
the period from July 13, 2005 (inception) to September 30, 2008
 (UNAUDITED)
  EarningsCommon
      Stock
              
              
              
              Paid-in
              
              
              
              AcccumulatedPar
      Value
              
              
              
              Capital
      in
              
              
              
              During
      the
              
              
              
              Total$0.0001
              
              
              
              Excess
      of
              
              
              
              Development
              
              
              
              Stockholders’Shares
              
              
              Amount
              
              
              
              Par
              
              
              
              Stage
              
              
              
              EquityStock
      issuance - July 13, 2005
              
              
              1,562,500
              
              
              
              157
              
              
              
              24,843
              
              
              
              —
              
              
              
              25,000Net
      loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (3,000
              )
              
              
              (3,000
              )Balance, at December 31,
      2005 (Audited)
              
              
              1,562,500
              
              
              
              157
              
              
              
              24,843
              
              
              
              (3,000
              )
              
              
              22,000Stock
      issuance on April 5, 2006 @$8.00
              
              
              6,156,250
              
              
              
              616
              
              
              
              49,249,384
              
              
              
              —
              
              
              
              49,250,000Stock
      issuance on April 5, 2006 @$8.00
              
              
              923,437
              
              
              
              92
              
              
              
              7,387,404
              
              
              
              —
              
              
              
              7,387,496Stock
      issuance on March 30, 2006 @$8.00
              
              
              93,750
              
              
              
              9
              
              
              
              749,991
              
              
              
              —
              
              
              
              750,000Proceeds
      from exercise of options on April 5, 2006
              
              
              230,859
              
              
              
              23
              
              
              
              3,671
              
              
              
              —
              
              
              
              3,694Expenses
      of offerings
              
              
              —
              
              
              
              —
              
              
              
              (4,684,871
              )
              
              
              —
              
              
              
              (4,684,871
              )Less:
      Proceeds subject to possible redemption of 1,415,229 shares, 19.99% of
      public shares are subject to redemption $7.65 per share
              —
              
              
              
              —
              
              
              
              (10,826,505
              )
              
              
              —
              
              
              
              (10,826,505
              )Net
      income
              
              
              —
              
              
              
              —
              
              
              
              —
              
              
              
              678,140
              
              
              
              678,140Balance, at December 31,
      2006  (Audited)
              
              
              8,966,796
              
              
              
              897
              
              
              
              41,903,917
              
              
              
              675,140
              
              
              
              42,579,954Adjustment
      in value of shares subject to possible conversion
              
              
              
              
              
              
              
              
              
              
              (576,708
              )
              
              
              
              
              
              
              (576,708
              )Net
      income
              
              
              —
              
              
              
              —
              
              
              
              —
              
              
              
              1,296,901
              
              
              
              1,296,901Balance, at December 31,
      2007 (Audited)
              
              
              8,966,796
              
              
              
              897
              
              
              
              41,327,209
              
              
              
              1,972,041
              
              
              
              43,300,147Deferred
      underwriting fees written-off
              
              
              
              
              
              
              
              
              
              
              2,265,500
              
              
              
              
              
              
              
              2,265,500Distribution
              
              
              
              
              
              
              
              
              
              
              (43,592,709
              )
              
              
              (1,853,965
              )
              
              
              (45,446,674
              )Net
      loss
              
              
              —
              
              
              
              —
              
              
              
              —
              
              
              
              (336,152
              )
              
              
              (336,152
              )Balance, at September
      30, 2008  (Unaudited)
              
              
              8,966,796
              
              
              
              897
              
              
              
              —
              
              
              
              (218,076
              )
              
              
              (217,179
              )
   See
accompanying notes to financial statements\
  - 5
-
 PHOENIX
INDIA ACQUISITION CORP.
 (a
corporation in the development stage)
 STATEMENTS
OF CASH FLOW
 (UNAUDITED)
 For
      periodfrom
      July 13,2005For
      the Nine Months Ended
                
                
                (inception)
      toSeptember
      30,
                
                
                September
      30,2008
                
                
                2007
                
                
                2008Cash
      flows from operating activitiesNet
      income (loss)
                
                $
                (336,152
                )
                
                $
                801,042
                
                
                $
                1,635,889Adjustment
      to reconcile net income (loss) to net cashprovided
      by operating activities:Increase
      (decrease) in accrued interest receivable
                
                
                116,279
                
                
                
                (278
                )
                
                
                —Increase
      (decrease) in prepaid expenses
                
                
                13,750
                
                
                
                (25,750
                )
                
                
                —(Decrease)
      increase in accounts payable and accrued expenses
                
                
                120,972
                
                
                
                (84,116
                )
                
                
                515,253Income
      taxes payable
                
                
                (671,408
                )
                
                
                (205,671
                )
                
                
                —Increase
      in refundable income taxes
                
                
                (422,155
                )
                
                
                
                
                
                
                (422,155
                )Net
      cash used in operating activities
                
                
                (1,178,714
                )
                
                
                485,227
                
                
                
                1,728,987Cash
      flows from investing activities:Return
      of Trust Deposits
                
                
                57,715,997
                
                
                
                —
                
                
                
                57,715,997Payment
      to trust account
                
                
                —
                
                
                
                (1,469,755
                )
                
                
                (57,715,997
                )Net
      cash provided by (used in) investing activities
                
                
                57,715,997
                
                
                
                (1,469,755
                )
                
                
                —Cash
      flows from financing activities:Proceeds
      from notes payable, stockholders
                
                
                85,282
                
                
                
                —
                
                
                
                85,282Gross
      proceeds from public offering
                
                
                —
                
                
                
                —
                
                
                
                56,637,496Gross
      proceeds from private offering
                
                
                —
                
                
                
                —
                
                
                
                750,000Proceeds
      from exercise of management options
                
                
                —
                
                
                
                —
                
                
                
                3,697Payment
      of offering costs
                
                
                —
                
                
                
                —
                
                
                
                (2,156,809
                )Proceeds
      from sale of common stock
                
                
                —
                
                
                
                —
                
                
                
                25,000Repayment
      of public & Private offering, stockholders
                
                
                (56,849,887
                )
                
                
                —
                
                
                
                (56,849,887
                )Payment
      of deferred offering costs
                
                
                
                
                
                
                
                
                
                
                (223,766
                )Net
      cash used in financing activities
                
                
                (56,764,605
                )
                
                
                —
                
                
                
                (1,728,987
                )Net
      increase (decrease) in cash
                
                
                (227,322
                )
                
                
                (984,528
                )
                
                
                —Cash,
      beginning of period
                
                
                227,322
                
                
                
                1,085,202
                
                
                
                —Cash,
      end of period
                
                $
                (0
                )
                
                $
                100,674
                
                
                $
                —Cash
      paid during the period for:Interest
                
                $
                —
                
                
                $
                —
                
                
                
                —Income
      taxes
                
                $
                671,408
                
                
                $
                —
                
                
                $
                1,460,308Supplemental
      non-cash financing transactionsAccrual
      of costs of public offering
                
                $
                —
                
                
                $
                —
                
                
                $
                2,265,500Write-off
      deferred underwriting fees
                
                $
                (2,265,500
                )
                
                $
                —
                
                
                $
                (2,265,500
                )
  See
accompanying notes to financial statements
 - 6
-
 NOTES
TO UNAUDITED FINANCIAL STATEMENTS
 September
30, 2008
 
 1.Basis of
Presentation
 
 The
financial statements for the three months ended September 30, 2008 are
unaudited. In the opinion of management, all adjustments (consisting only of
normal recurring accruals) have been made that are necessary to present fairly
the financial position of Phoenix India Acquisition Corp. (the “Company”) as of
September 30, 2008, and the results of its operations and its cash flows for the
three months ended September 30, 2008, and period from July 13, 2005 (inception)
to September 30, 2008, in conformity with generally accepted accounting
principles. Operating results for the interim period are not necessarily
indicative of the results to be expected for the full year.
 
 2.Nature of Operations
and Summary of Significant Accounting Policies`
 
 Introduction
 
 We were a
blank check company organized under the laws of Delaware, incorporated on July
13, 2005, in order to serve as a vehicle for the acquisition of an operating
business through a merger, capital stock exchange, asset acquisition or other
similar business combination. We intended to focus our efforts on identifying
within the information technology, information technology enabled service and
information technology enabled products (IT/ITES/ITEP) industries, a prospective
target business (or businesses), including those in the knowledge process
outsourcing, or KPO, and business process outsourcing, or BPO, sectors operating
in India.
 
 On March
1, 2008, the board of directors changed the direction of the Company and the
Company entered into a Share Subscription Agreement (the “Subscription
Agreement”)
and a Shareholders Agreement (the “Shareholder Agreement”) with Citius Power
Limited, a limited liability company incorporated under the laws of the Republic
of Mauritius (“Citius Mauritius” or “Target”) and all of the existing
shareholders of Citius Mauritius. Under these agreements we were to subscribe
for 4,500,000 (Four Million Five Hundred Thousand) convertible preference shares
(the “Convertible Preference Shares”) of Citius Mauritius, representing 65% of
the equity shares of Citius Mauritius on an as converted fully diluted basis.
Citius Mauritius through its 99.99% subsidiary, Citius Power Limited (“Citius
India”) will acquire, own and operate already installed or build to own wind
energy assets in India. The Subscription Agreement and the Shareholder Agreement
expired on May 15, 2008.
  On March
26, 2008, the Company’s Board of Directors voted to liquidate the trust for the
benefit of stockholders excluding management. The Company’s officers notified
American Stock Transfer & Trust Company, the trustee to liquidate the trust
assets. The liquidation date was set for April 20, 2008, and funds were
remitted to the stockholders by the trustee on April 21, 2008. The actual
per-share redemption price was equal to the amount in the trust account
(exclusive of the proceeds of the private placement) net of taxes, divided by
the number of shares sold in our public offering. After taking into account any
interest earned on the trust account, the per-share redemption price was
approximately $8.03.
 
 On April
8, 2008, the Company held its special shareholders meeting. A majority of the
stockholders of the Company approved the proposed amendment of the Certificate
of Incorporation and removed Article SIXTH, and redesignated Articles SEVENTH,
EIGHT, AND NINTH as Articles SIXTH, SEVENTH, and EIGHTH, respectively. As a
result, the Company does not have to be liquidated and will continue its efforts
to close the
  - 7
-
 announced
transaction with the Target by raising new capital through a private placement
or pursue other transactions.
 
 On April
21, 2008, the trustee distributed all of the monies held in the trust account to
all unit holders and shareholders with redemption right. The net cash per share
or unit that was distributed was $8.03.
 
 Cash
and cash equivalents
  The
Company considers all highly liquid investments with original maturities of
three months or less to be cash equivalents. The Company maintains cash balances
with financial institutions, which, at times, may exceed the Federal Deposit
Insurance Corporation limit. The Company has not experienced any losses to date
as a result of this policy, and management believes there is little risk of
loss.
  Net
Income (Loss) Per Common Share
  Net
income (loss) per share is computed by dividing net income by the
weighted-average number of shares of common stock outstanding during the
period.
  Derivative
Financial Instrument
  As
described in Note 5, the Company has granted a Purchase Option to a
representative of its underwriters. Based on Emerging Issues Task Force 00-19,
Accounting for Derivative Financial Instruments Indexed to, and Potentially
Settle in, a Company’s Own Stock, the sale of the Purchase Option was reported
in permanent equity and accordingly, there is no impact on the Company’s
financial position and results of operations, except for the $100 in proceeds
from the sale. Subsequent changes in fair value will not be recognized as long
as the Purchase Option continues to be classified as an equity
instrument.
  The
Company has determined, based on the Black-Scholes option pricing formula, the
fair value of the Purchase Option at date of issuance, was $6.04 per share or
approximately $2,602,859 in total, using a risk-free interest rate of 5.0%,
expected life of five years and estimated volatility of 100.0%.
  The
volatility estimate of 100.0% is based on information currently available to
management. Although an expected life of five years was used in the calculation,
if the Company does not consummate a business combination within the prescribed
time period and the Company liquidates, the Company believes the option will
become worthless.
  Use
of Estimates
 
 The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
expenses during the reporting period. Actual results could differ from those
estimates.
 
 Income
Taxes
 
 Deferred
income taxes are provided for the differences between the basis of assets and
liabilities for financial reporting and income tax purposes. A valuation
allowance is established, when necessary, to reduce deferred tax assets to the
amount expected to be realized.
  The
effective tax rate differs from the statutory rate of 35.5% primarily due to all
interest income being generated from tax-exempt securities.
  - 8
-
 Recent
Accounting Pronouncements
  The
Company does not believe that any recently issued, but not yet effective,
accounting standards, if currently adopted, would have a material effect on the
accompanying financial statements.
  3. Going
Concern
  The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern, which contemplates the realization of assets
and the satisfaction of liabilities in the normal course of business. The
Company has incurred operating losses and negative operating cash flow since
inception and future losses are anticipated. The Company’s plan of operations,
even if successful, may not result in cash flow sufficient to finance and expand
its business. These factors raise substantial doubt about the Company’s ability
to continue as a going concern. Realization of assets is dependent upon
continued operations of the Company, which in turn is dependent upon
management’s plans to meet its financing requirements and the success of its
future operations. These financial statements do not include any adjustments
related to the recoverability and classification of asset amounts or the amounts
and classification of liabilities that might be necessary should the Company be
unable to continue in existence.
 
 We plan
to raise additional capital with a view to making ourselves an attractive
vehicle to acquire a business. We will then seek a suitable acquisition
candidate. No such business has been identified and we are therefore subject to
a number of risks, including: any acquisition consummated by us may turn out to
be unsuccessful; investors in us will not know what operating business, if any,
will be acquired, including the particular industry in which the business
operates, and whether dilutive financing will be required therewith; the
historical operations of a specific business opportunity may not necessarily be
indicative of the potential for the future; we may acquire a company in the
early stage of development, causing us to incur further risks; we may be
dependent upon the management of an acquired business which has not proven its
abilities or effectiveness; we will be controlled by a small number of
stockholders, and such control could prevent the taking of certain actions that
may be beneficial to other stockholders; our common stock will likely be thinly
traded; and the public market may provide little or no liquidity for holders of
our common stock.
 
 4. Income
Taxes
 
 Effective
January 1, 2007, we adopted the provisions of Financial Accounting Standards
Board (FASB) Interpretation No. 48, “Accounting for Uncertainty in Income Taxes,
an interpretation of FASB Statement No. 109” (FIN 48). FIN 48 clarifies the
accounting for uncertainty in income taxes recognized in the Company’s financial
statements in accordance with FASB 1099, “Accounting for Income Taxes,” and
prescribes a recognition threshold and measurement process for financial
statement recognition and measurement of a tax position taken or expected to be
taken in a tax return. FIN 48 also provides guidance on recognition,
classification, interest and penalties, accounting in interim periods,
disclosure and transition.
 
 Management
has evaluated and concluded that there are no significant tax provisions
requiring recognition in the Company’s financial statements as of January 1,
2008. The evaluation was performed for the tax years ended December 31, 2007 and
2006, which remain subject to examination for Federal and state purposes as of
September 30, 2008.
 
 The
Company’s policy is to classify assessments, if any, for tax related interest as
interest expenses and penalties as general and administrative
expenses.
  5.  Notes
Payable, Stockholders
  As of
September 30, 2008, the Company issued unsecured promissory notes to management
of the Company totaling $85,282. The Notes bear interest at the rate of 4% per
annum.
  - 9
-
 6.  Related Party
Transaction
  The
Company has agreed to pay Phoenix Capital Partners LLC, a company of which an
executive officer is the sole member, an administrative fee of $5,000 per month
for office space and general and administrative services from the effective date
of the Public Offering through the acquisition date of a target business. This
agreement expired as of March 31, 2008.
 
 7. Preferred
Stock
  The
Company is authorized to issue 1,000,000 shares of preferred stock with such
designations, voting and other rights and preferences, as may be determined from
time to time by the Board of Directors.
  8. Per Share
Information
  In
accordance with SFAS No. 128, “Earnings Per Share”, basic earnings per common
share (“Basic EPS”) is computed by dividing the net income by the
weighted-average number of shares outstanding. Diluted earnings per common share
(“Diluted EPS”) are computed by dividing the net income by the weighted-average
number of common shares and dilutive common share equivalents and warrants then
outstanding. SFAS No. 128 requires the presentation of both Basic EPS and
Diluted EPS on the face of the Company’s Condensed Statements of Income. Common
share equivalents totaling 860,074 were excluded from the computation with
respect to the three months ended September 30, 2008 and for the period since
inception on July 13, 2005 to September 30, 2008, as their impact would have
been anti-dilutive.
 
 The
following table sets forth the computation of basic and diluted per share
information:
 
 PHOENIX
INDIA ACQUISITION CORP.
 (a
corporation in the development stage)
 EARNINGS
PER SHARE
 (UNAUDITED)
  Three
      Months Ended
                  September
      30,
                
                
                Nine
      Months Ended
                  September
      30,
                
                
                For
      the periodfrom
                      April
      13, 2005to2008
                
                
                2007
                
                
                2008
                
                
                2007
                
                
                September
      30, 2008Numerator:Net
      Income (loss)
                
                $
                (19,350
                )
                
                $
                405,335
                
                
                $
                (336,152
                )
                
                $
                801,041
                
                
                $
                1,635,889Denominator:Weighted-average
      common shares outstanding
                
                
                8,966,796
                
                
                
                8,966,796
                
                
                
                8,966,796
                
                
                
                8,966,796
                
                
                
                6,994,782Dilutive
      effect of warrants
                
                
                —
                
                
                
                5,930,421
                
                
                
                —
                
                
                
                5,891,456
                
                
                
                5,097,249Weighted-average
      common shares outstanding, assuming dilution
                
                
                8,966,796
                
                
                
                14,897,217
                
                
                
                8,966,796
                
                
                
                14,858,252
                
                
                
                12,092,031Net Income Per
      Share:Basic
                
                $
                (0.00
                )
                
                $
                0.05
                
                
                $
                (0.04
                )
                
                $
                0.09
                
                
                $
                0.23Diluted
                
                
                (0.00
                )
                
                $
                0.03
                
                
                
                (0.04
                )
                
                $
                0.05
                
                
                $
                0.14
  - 10
-
 Item
2. Management’s
Discussion and Analysis of Financial Condition and Results of
Operations.
  Forward
Looking Statements
  This
Quarterly Report on Form 10-Q includes forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended.
We have based these forward-looking statements on our current expectations and
projections about future events. These forward-looking statements are subject to
known and unknown risks, uncertainties and assumptions about us that may cause
our actual results, levels of activity, performance or achievements to be
materially different from any future results, levels of activity, performance or
achievements expressed or implied by such forward-looking statements. In some
cases, you can identify forward-looking statements by terminology such as “may”,
“should”, “could”, “would”, “expect”, “plan”, “anticipate”, “believe”,
“estimate”, “continue”, or the negative of such terms or other similar
expressions. Factors that might cause or contribute to such a discrepancy
include, but are not limited to, those described in our other Securities and
Exchange Commission filings. The following discussion should be read in
conjunction with our Financial Statements and related Notes thereto included
elsewhere in this report.
  DESCRIPTION
OF BUSINESS
  We are inactive and are
currently considered a “shell” company by the
SEC, and we have no operations. We were organized as a blank check company to
serve as a vehicle to acquire, through a merger, capital stock exchange, asset
acquisition or other similar business combination, an operating
business.
  Company is a Blank Check Company
  At present, the Company
has no sources of revenue and has no specific business plan or purpose. The
Company’s
business plan is to seek a Business Combination. As a result, the Company is a
“blank
check” or
“shell” company. Many
states have inacted statutes, rules and regulations limiting the sale of
securities of shell companies in their respective jurisdictions. Management does
not intend to undertake any efforts to cause a market to develop in the
Company’s
securities or undertake any offering of the Company’s securities,
either debt or equity, until such time as the Company has successfully
implemented its business plan and closed on a suitable Business
Combination.
  Critical
Accounting Policies.
  The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
expenses during the reporting period. Actual results could differ from those
estimates.
  Management
does not believe that any recently issued, but not yet effective, accounting
standards if currently adopted would have a material effect on the accompanying
financial statements.
  Results
of Operations for the Three and Six Months Ending September 30,
2008
  For the
three and nine months ending September 30, 2008, we had a net loss of $19,350
and $336,152, respectively primarily as a result of interest income received on
funds held in trust offset in part by consulting and professional fees and other
operating expenses.
  For the
three month period ending September 30, 2008, the trust account earned no
interest.  For the nine month period ending September 30, 2008, the
trust account earned $495,001 in interest.
 
 Liquidity
and Capital Resources.
  On April
5, 2006, we consummated our initial public offering of 7,079,687 units
(including 923,437 units subject to the underwriters’ over-allotment option) and
a private placement of 93,750 units sold to the existing officers and directors
through an entity they own. Each unit consists of one share of common stock and
one redeemable common stock purchase warrant. Each warrant entitles the holder
to purchase from us one share of our common stock at an exercise price of
$5.00.
  Our net
proceeds from the sale of our units, including amounts from exercise of the
underwriters’ over-allotment option and the private placement, after deducting
certain offering expenses of approximately $722,713, (including the proceeds
from the underwriters’ overallotment), and underwriting discounts of
approximately $1,699,124, were approximately $55,350,000. Of this amount, on
April 21, 2008, approximately $58,214,833 less taxes held in trust was
distributed by the trustee to the shareholders with redemption rights at $8.03
per share and/or unit.  Included in such distributed amount was the
deferred underwriting fee of $2,265,500 which was reflected as an increase in
additional paid in capital.
 
 - 11
-
 We have
granted a purchase option to the representative of the underwriter at the
closing of the Offering on April 5, 2006 to acquire 430,937 units at $8.80 per
unit for $100. The fair value of the purchase option was estimated at $6.04 per
share or approximately $2,602,859 in the aggregate. The purchase option was
accounted for as an equity instrument in permanent equity. Accordingly, there
was no impact on our financial position or results of operations, except for
recording the $100 proceeds from the sale.
  On April
21, 2008, the trustee distributed $8.03 per share and/or unit to shareholders
with redemption rights.
 
 Off-Balance
Sheet Arrangements.
  We have
never entered into any off-balance sheet financing arrangements and have never
established any special purpose entities. We have not guaranteed any debt or
commitments of other entities or entered into any options on non-financial
assets.
  Item
3. Quantitative and
Qualitative Disclosures About Market Risk
  Market
risk is the sensitivity of income to changes in interest rates, foreign
exchanges, commodity prices, equity prices, and other market-driven rates or
prices. We are not presently engaged in and, if a suitable business target is
not identified by us prior to the prescribed liquidation date of the trust fund,
we may not engage in, any substantive commercial business. Accordingly, we are
not and, until such time as we consummate a business combination, we will not
be, exposed to risks associated with foreign exchange rates, commodity prices,
equity prices or other market-driven rates or prices. The net proceeds of our
initial public offering held in the trust fund have been invested only in money
market funds meeting certain conditions under Rule 2a-7 promulgated under the
Investment Company Act of 1940 or United States treasury bills. Given our
limited risk in our exposure to these money market funds and treasury bills, we
do not view the interest rate risk to be significant.
 
 Item
4T. Controls and
Procedures.
  Our
management is responsible for establishing and maintaining a system of
disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e)
under the Exchange Act) that is designed to ensure that information required to
be disclosed by us in the reports that we file or submit under the Exchange Act
is recorded, processed, summarized and reported, within the time periods
specified in the Commission’s rules and forms. Disclosure controls and
procedures include, without limitation, controls and procedures designed to
ensure that information required to be disclosed by an issuer in the reports
that it files or submits under the Exchange Act is accumulated and communicated
to the issuer’s management, including our principal executive officer or
officers and principal financial officer or officers, or persons performing
similar functions, as appropriate to allow timely decisions regarding required
disclosure.
 
 In
accordance with Exchange Act Rules 13a-15 and 15d-15, we completed an evaluation
under the supervision and with the participation of our President and Chief
Strategy Officer of the effectiveness of the design and operation of our
disclosure controls and procedures as of the end of the period covered by this
Quarterly Report. Based on that evaluation, the Company’s President and Chief
Strategy Officer, concluded that our disclosure controls and procedures as of
September 30, 2008 had deficiencies that caused the Company’s controls and
procedures to be ineffective. These deficiencies consisted of inadequate
staffing and supervision that could lead to the untimely identification and
resolution of accounting and disclosure matters and failure to perform timely
and effective reviews. Management is presently evaluating its options with its
auditor to address these deficiencies. During the period covered by this
Quarterly Report on Form 10-Q, there has been no change in our internal control
  - 12
-
 over
financial reporting that has materially affected, or is reasonably likely to
materially affect, our internal control over financial
reporting.
 
 PART
II - OTHER INFORMATION
  Item
1.   Legal
Proceedings.
  None
  Item
1A.Risk
Factors.
 
 Risks associated with our
business
 
 We
are a development stage company with no operating history and, accordingly, our
stockholders will not have any basis on which to evaluate our ability to achieve
our business objective.
  We are a
development stage company with no operating results to date. Since we do not
have an operating history, our stockholders will have no basis upon which to
evaluate our ability to achieve our business objective, which is to acquire one
or more operating businesses. We will not generate any revenues until, at the
earliest, after the consummation of a business combination.
  Since
we have not closed on the selected target business to complete a business
combination, investors are unable to currently ascertain the merits or risks of
the target business’ operations.
 
 Since we
have not yet closed on the target business, investors have no current basis to
evaluate the possible merits or risks of the target business’ operations. To the
extent we close on a transaction with an entity in its development stage, we may
be affected by numerous risks inherent in the business operations of those
entities. Although our management will endeavor to evaluate the risks inherent
in a particular target business, we cannot assure our stockholders that we will
properly ascertain or assess all of the significant risk factors.
 
 We
will issue shares of our capital stock or convertible debt securities to
complete a business combination, which would reduce the equity interest of our
stockholders and likely cause a change in control of our ownership.
 
 Our
certificate of incorporation authorizes the issuance of up to 89,000,000 shares
of common stock, par value $.0001 per share, and 1,000,000 shares of blank check
preferred stock, par value $.0001 per share. As of March 31, 2008, there
were 80,033,234 authorized but unissued shares of our common stock available for
issuance (after appropriate reservation for the issuance of shares upon full
exercise of our outstanding warrants) and all of the 1,000,000 shares of blank
check preferred stock available for issuance. We will issue a substantial number
of additional shares of our common stock or blank check preferred stock, or a
combination of common and blank check preferred stock, to complete a business
combination. The issuance of additional shares of our common stock or any number
of shares of our blank check preferred stock:
  ·
              Will
      significantly reduce the equity interest of current
      stockholders;
 ·
              Will
      cause a change in control if a substantial number of our shares of common
      stock are issued, which may affect, among other things, our ability to use
      our net operating loss carry forwards, if any, and most likely also result
      in the resignation or removal of our present officers and
      directors;
 ·
              Will
      reduce or limit the voting power or other rights of holders of our common
      stock if we issue preferred stock with dividend, liquidation, compensation
      or other rights superior to the common stock; and
 
 - 13
-
 ·
              Will
      reduce the prevailing market prices for our common stock warrants and
      units.
 
 Similarly,
if we issue debt securities, it could result in:
 
 ·
              Default
      and foreclosure on our assets if our operating cash flow after a business
      combination were insufficient to pay our debt
  obligations;
 ·
              Acceleration
      of our obligations to repay the indebtedness even if we have made all
      principal and interest payments when due if the debt security contained
      covenants that required the maintenance of certain financial ratios or
      reserves and any such covenant were breached without a waiver or
      renegotiation of that covenant;
 ·
              Our
      immediate payment of all principal and accrued interest, if any, if the
      debt security was payable on demand; and
 ·
              Our
      inability to obtain additional financing, if necessary, if the debt
      security contained covenants restricting our ability to obtain additional
      financing while such security was
outstanding.
 
 We may choose to redeem our
outstanding warrants at a time that is disadvantageous to the
warrant holders.
 
 Subject
to there being a current prospectus under the Securities Act of 1933, we
may redeem all of our outstanding warrants at any time after they become
exercisable at a price of $.01 per warrant, upon a minimum of 30 days
prior written notice of redemption, if and only if, the last sale price of
our common stock equals or exceeds $11.50 per share for any 20 trading days
within a 30 trading day period ending three business days before we send the
notice of redemption. Calling all of our outstanding warrants for redemption
could force the warrant holders:
 
 ·
              To
      exercise the warrants and pay the exercise price for such warrants at
      a time when it may be disadvantageous for the holders to do
      so;
 ·
              To
      sell the warrants at the then current market price when they might
      otherwise wish to hold the warrants; or
 ·
              To
      accept the nominal redemption price which, at the time the warrants
      are called for redemption, is likely to be substantially less than
      the market value of
the warrants.
 
 Our
warrant holders may not be able to exercise their warrants, which may create
liability for us.
  Holders of our
warrants issued in our initial public offering and private placement will be
able to receive shares upon exercise of the warrants only if (i) a current
registration statement under the Securities Act of 1933 relating to the shares
of its common stock underlying the warrants is then effective and (ii) such
shares are qualified for sale or exempt from qualification under the applicable
securities laws of the states in which the various holders of warrants reside.
Although we have agreed to use our best efforts to maintain a
current registration statement covering the shares underlying the warrants
to the extent required by federal securities laws, and we intend to comply
with such agreement, we cannot assure that it will be able to do so. In
addition, some states may not permit us to register the shares issuable
upon exercise of its warrants for sale. The value of the warrants will be
greatly reduced if a registration statement covering the shares issuable upon
the exercise of the warrants is not kept current or if the securities are
not qualified, or exempt from qualification, in the states in which the
holders of warrants reside. Holders of warrants who reside in jurisdictions
in which the shares underlying the warrants are not qualified and in which
there is no exemption will be unable to exercise their warrants and would
either have to sell their warrants in the open market or allow them to
expire unexercised. If and when the warrants become redeemable by us, we may
exercise our redemption right even if we are unable to qualify the
underlying securities for sale under all applicable state securities laws.
Since our obligations in this regard are subject to a “best efforts” standard,
it is
  - 14
-
 possible
that, even if we are able to successfully assert a defense to a claim by warrant
holders due to the impossibility of registration, a court may impose monetary
damages on us to compensate warrant holders due to the change in circumstances
that led to us being unable to fulfill our obligations.
  We do not have an Audit Committee
composed solely of independent directors and therefore our financial statements have not
been subject to independent review.
 
 We do not
have an audit committee. Pursuant to SEC regulations, the entire Board of
Directors of a company without an audit committee acts as the audit committee.
All of the members of our Board of Directors are also officers and therefore not
independent. Therefore, we do not have solely independent directors reviewing
our financial statements, making it more difficult for us to discover if there
was any fraud in connection with the preparation of our financial
statements.
 
 We
may be unable to obtain additional financing, if required, to complete the
contemplated transaction or to fund the operations and growth of the target
business, which could compel us to restructure the transaction.
 
 If we
have insufficient funds to complete any transaction through our private
placement efforts, we will be required to seek additional financing. We cannot
assure our stockholders that such financing would be available on acceptable
terms, if at all. To the extent that additional financing proves to be
unavailable when needed to consummate the proposed transaction, we would be
compelled to restructure the transaction or abandon it altogether and seek an
alternative target business candidate. In addition, we may not have a sufficient
amount of working capital available to finding an alternate suitable business
combination without securing additional financing. If we were unable to secure
additional financing, we would most likely fail to consummate a business
combination. In addition, if we consummate an alternate business combination, we
may require additional financing to fund the operations or growth of the target
business. The failure to secure additional financing could limit the development
or growth of the target business. None of our officers, directors or
stockholders is required to provide any financing to us in connection with or
after a business combination.
 
 Our
ability to successfully effect a transaction with any target company and to be
successful afterward will be totally dependent upon the efforts of our
management, some of whom may join us following such transaction and whom we
would have only a limited ability to evaluate. It is also possible that one or
more of our current officers and directors will resign upon the completion of
such transaction.
 
 Our
ability to successfully effect our investment in any target will be totally
dependent upon the efforts of the members of our management team. The future
role of our management following the transaction, however, cannot presently be
fully ascertained. Although we expect our officers and directors to remain
associated with us following the transaction, we may employ other personnel
following the business combination. Moreover, our current management will only
be able to remain with the combined company after the transaction if they are
able to negotiate and agree to mutually acceptable employment terms as part of
any such transaction, which terms would be disclosed to stockholders in any
statement relating to such transaction. In making the determination as to
whether current management should remain with us following the transaction,
management will analyze the experience and skill set of the target business’
management and negotiate that certain members of current management remain, if
it is believed to be in the best interests of the combined company subsequent to
the transaction. The terms of any employment or consulting arrangements of our
current management with the combined company post-transaction will be determined
at the time the transaction closes. Since our current management will be
negotiating the terms of the transaction as well as the terms of their
employment or consulting arrangements, our current management may have a
conflict of interest in negotiating terms favorable to the company in the
agreement and at the same time negotiating terms in their employment or
consulting arrangements that are favorable to them. Although management intends
to fully exercise its fiduciary duty to negotiate terms that will be in the best
interests of the combined-company and its public stockholders, members of
management may be negotiating terms in their employment or consulting agreements
that are favorable to them. While we intend to closely scrutinize any additional
individuals we engage after a business combination, we cannot assure our
stockholders that our assessment of these individuals will prove to be correct.
These individuals may be unfamiliar with the requirements of operating a public
company, as well as United States securities laws, which could cause us to have
to expend time and resources helping them
  - 15
-
 become
familiar with such laws. This could be expensive and time-consuming and could
lead to various regulatory issues, which may result in our operations becoming
less efficient.
  Our
officers and directors will allocate their time to other businesses, thereby
causing conflicts of interest in their determination as to how much time to
devote to our affairs. This could have a negative impact on our ability to
consummate a business combination.
 
 Our
officers and directors are not required to commit their full time to our
affairs, which may result in a conflict of interest in allocating their time
between our operations and other businesses. We do not intend to have any
full-time employees prior to the consummation of a business combination. Our
officers are engaged in several other business endeavors and are not obligated
to contribute any specific number of hours per week to our affairs. While it is
our officers’ intention to devote substantial business time to identifying
potential target businesses and consummating a business combination, their other
business affairs could require them to devote more substantial amounts of time
to such affairs, thereby limiting their ability to devote time to our affairs.
This could have a negative impact on our ability to consummate a business
combination.
 
 Our
officers and directors may in the future become affiliated with entities engaged
in business activities similar to those intended to be conducted by us and,
accordingly, may have conflicts of interest in determining to which entity a
particular business opportunity should be presented.
 
 Although
none of our officers, directors or affiliates have previously been associated
with any “blank check” companies, our officers and directors may in the future
become affiliated with entities, including other “blank check” companies,
engaged in business activities similar to those intended to be conducted by us.
Additionally, our officers and directors may become aware of business
opportunities which may be appropriate for presentation to us as well as the
other entities with which they are or may be affiliated. Further, certain of our
officers and directors are currently involved in merchant banking/private equity
businesses. Due to these existing affiliations, they may have fiduciary
obligations to present potential business opportunities to those entities prior
to presenting them to us which could cause additional conflicts of interest.
Accordingly, they may have conflicts of interest in determining to which entity
a particular business opportunity should be presented.
  Our
directors may not be considered “independent” under the policies of the North
American Securities Administrators Association, Inc.
  Under the
policies of the North American Securities Administrators Association, Inc., an
international organization devoted to investor protection, because each of our
directors owns shares of our securities and may receive reimbursement for
out-of-pocket expenses incurred by him in connection with activities on our
behalf, such as identifying potential target businesses and performing due
diligence on suitable business combinations, state securities administrators
could take the position that such individuals are not “independent.” If this
were the case, they would take the position that we would not have the benefit
of independent directors examining the propriety of expenses incurred on our
behalf and subject to reimbursement. Additionally, there is no limit on the
amount of out-of-pocket expenses that could be incurred, and there will be no
review of the reasonableness of the expenses by anyone other than our board of
directors, which would include persons who may seek reimbursement, or a court of
competent jurisdiction if such reimbursement is challenged. Although we believe
that all actions taken by our directors on our behalf will be in our best
interests, whether or not they are deemed to be “independent,” we cannot assure
our stockholders that this will actually be the case. If actions are taken, or
expenses are incurred that are actually not in our best interests, our revenues
and profits could be reduced, and the price of our stock held by the public
stockholders could decrease.
 
 Item
2. Unregistered Sales of
Equity Securities and Use of Proceeds.
  Not
applicable.
  - 16
-
 Item
3. Defaults Upon Senior
Securities.
  Not
applicable.
  Item
4. Submission of Matters
to a Vote of Security Holders.
  Not
applicable.
  Item
5. Other
Information.
  Not
applicable.
  Item
6. Exhibits.
  (b)
Exhibits
  31
              Certification
      of Principal Executive Officer and Principal Financial Officer pursuant to
      Rule 13a-14(a) of the Securities Exchange Act, as
  amended.
  32
              Certification
      of the Principal Executive Officer and Principal Financial Officer
      pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002.
  
 SIGNATURES
  In
accordance with the requirements of the Exchange Act, the registrant caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.
  PHOENIX
      INDIA ACQUISITION CORP.Date:
      November 19, 2008
                By:
                /s/ Ramesh
      AkellaRamesh
      AkellaPresident,
      Chief Strategy Officer and Director
                  (Principal
      Executive Officer and Principal Financial Officer)
   - 17
-