Heat 2 tablespoons of ghee in a handi, pan, or kadai. Keep the heat low.
Add 1 small bay leaf, 1-inch piece of cinnamon, 2 cloves, 2 green cardamoms, and 2 individual strands of mace.
Fry the spices on low heat for some seconds till they become aromatic.
Add ⅓ cup chopped onions.
Mix and begin to saute onions on a low to medium heat stirring often. First, the onions will become translucent.
Sprinkle a little salt.
Saute till the onions turn golden stirring often
Add1 teaspoon of ginger-garlic paste, 1 slit green chili, and 1 tablespoon of chopped coriander leaves.
Cook for a few seconds until the strong smell of ginger and garlic disappears.
Add ½ cup of finely chopped tomatoes.
Mix the tomatoes and saute them on a low to medium heat.
Sauté until the tomatoes become soft and mushy. Make sure they’re cooked thoroughly, and you can see oil separating from the mixture of sautéed onions and tomatoes.
Reduce the temperature.
Add ¼ teaspoon of turmeric powder
Add ¼ teaspoon of Kashmiri red chili powder
Add ½ teaspoon of garam masala powder
Add the prepared cashew paste.
Stir and mix well.
Stir frequently and cook them until you notice oil separating from the sides.
Add 2 teaspoons of milk powder. If you are using cream, you can add 1 to 2 tablespoons of it after the gravy is ready.
Stir and mix very well.
Add 1 cup of water.
Season with salt as per taste and mix.
Simmer the gravy gently for about 6 to 7 minutes over medium-low heat.
Add 200 grams paneer cubes and stir to mix.
Turn off the heat.
Sprinkle in ½ teaspoon of crushed kasuri methi (dried fenugreek leaves).
You can also add a small amount, about 1 to 2 pinches, of nutmeg powder or grated nutmeg.
Stir and mix gently.
Serve the Paneer Handi while it’s hot or warm, along with naan, chapati, plain paratha, butter naan, cumin rice, or saffron rice. Enjoy it with your favorite bread or rice!