Heat a pan (kadhai) and add a little oil. Once it's warm, add the butter. Adding oil first stops the butter from burning.
Once the butter melts, add the cumin seeds and let them roast well.
Add the finely chopped onions. Sauté them on medium heat until they are well-cooked and light brown.
Add the ginger paste and garlic paste. Cook for another minute until the raw smell is gone.
Stir in the finely chopped green chilli and sauté for one more minute.
Add the finely chopped tomatoes and cook for about 2 minutes, stirring well.
Add the finely chopped capsicum. Continue to sauté everything together for 2-3 minutes.
Turn the heat to low and add all the dry spices: turmeric powder, coriander powder, roasted cumin powder, pav bhaji masala, and chilli powder.
Mix the spices well and cook for a minute.
Add salt to your taste and a handful of chopped coriander leaves. Give it a good mix.
Pour in one glass of lukewarm water and stir to combine everything into a gravy.
Cover the pan with a lid, keep the heat on low, and let the gravy cook for 2-3 minutes.
Remove the lid. Now, take the 300 g block of paneer and grate it directly into the bubbling gravy.
Set the heat to medium and mix the grated paneer well, combining it with the masala gravy.
Cover the pan again and let it cook on low heat for another 2 minutes.
Open the lid and add the Kasuri Methi (crush it between your palms before adding) and some more fresh coriander leaves. Mix well.
Your delicious Paneer Ghotala is ready! For an extra rich taste, you can grate some cheese on top before serving.