Add 1 tablespoon cumin seeds, ½ teaspoon fennel seeds, ½ teaspoon whole black peppercorns, 2 teaspoons coriander seeds, ½ teaspoon kalonji, and 2 dried red chillies to a small frying-pan over low heat.
Toast the whole spices (no oil!) until they smell fragrant and aromatic. They will slightly brown. Turn off the heat and allow them to cool.
Use a small spice grinder to grind the whole spices to a fine powder. Set aside.
Make the Onion-Tomato Base
Heat 1 teaspoon ghee1 in a large pressure cooker over medium heat. Add 1 Indian bay leaf, 4 medium tomatoes (whole), 1 medium onion (roughly chopped), 1 inch ginger (peeled), 4 cloves garlic, 300 millilitres water, and optionally, the stalks of the fresh coriander you'll use for garnish.
Cover with a lid. Pressure cook for 2-3 whistles, then let the pressure release.
If you don't have a pressure cooker, boil the mixture until the tomatoes are thoroughly soft.
Carefully peel off the tomato skins. Be careful — they're still hot.
Let the mixture cool, then blend to a smooth, silky paste.
Make the Paneer Balti
In a large, non-stick frying pan (or cast iron) set over medium heat, add 1 teaspoon neutral oil.
Cut 400 grams paneer1 into large chunks. Carefully place the paneer in the hot oil. Cook until golden on all sides, turning when needed. Remove from the heat and set aside.
In a large kadai or Balti bowl over medium heat, add 2 tablespoons ghee1.
Add ½ teaspoon turmeric powder, 1 teaspoon coriander powder, and 1 teaspoon red chilli powder to the ghee. Immediately add the balti spice mix we prepared earlier.
Let the spices infuse for a few seconds, then add 1 tablespoon tomato puree (double concentrate)2. Stir in.
Pour the onion-tomato base sauce into the kadai, season with fine sea salt (to taste), and turn the flame to high.
Let the Balti cook until thick, aromatic, and slightly charred on the edges.
Add the fried paneer chunks, 50 grams red onion (cut into chunks), and 100 g green bell pepper (cut into chunks) to the kadai. Cook for two minutes.
Finish the dish with 2 teaspoons tamarind sauce. Stir that in, then crush ½ teaspoon dried fenugreek leaves (kasuri methi) between your palms. Add that too.
Turn off the heat and garnish with 1 small handful fresh coriander leaves (finely chopped) and 1 green chillies (roughly cut). Serve hot.
Notes
¹ To make this paneer balti vegan, substitute ghee for neutral oil or vegan butter, and switch paneer for extra-firm tofu. ² What we call "tomato puree" in the U.K. is called "tomato paste" in the U.S. You want the thick stuff sold in a tube.