In a wide pan, heat 1 tablespoon of oil and add the cubed paneer pieces in it. Fry the paneer until it develops some color and then place them in a bowl of hot water. This helps in keeping the cheese pieces soft. We can also use the paneer pieces without frying, but we like it this way.

Add one more tablespoon of oil in the same pan. Once the oil heats up, add the cubed onion pieces and fry it until light golden brown. Remove it in a bowl and keep it aside.

In the same pan, add the remaining 1 tablespoon of oil. Add the cumin seeds and bay leaf. Let them fry for about 20 seconds.

Now add the finely chopped onions. Sauté the onions until golden brown.

Add the turmeric powder, red chili powder, cumin and coriander powder, garam masala and salt. Mix well and fry for about 2 – 3 minutes.

Meanwhile grind the tomatoes to a smooth paste. Add this paste to the onion mixture. Let it cook for about 10 minutes.

Now add the fried cubed onion along with paneer pieces and kasuri methi and mix well.

Add ½ a cup of water (if needed) and let it simmer for about 5 minutes for the flavors to combine.

Grind the soaked cashews into a smooth paste and add it to the gravy. Mix well and let it come to one quick boil.

I served it with Buckwheat flour paratha / kuthu Paratha.