To prepare Shahi Paneer, cut paneer into medium cubes.
Heat 1–2 tbsp ghee/oil in a pan. Lightly fry paneer on medium heat until edges turn golden. Set aside.
In a pan, heat 2 tbsp ghee or oil.
Add cumin seeds, bay leaf, cardamom, and cinnamon to make masala paste. Sauté until aromatic.
Add cashews and sauté for 1–2 minutes.
Add chopped onions and cook until translucent.
Then add pureed tomatoes and ginger-garlic paste. Cook for 5–7 minutes until oil separates.
Cool the mixture slightly and blend the masala into a smooth paste with the sautéed nuts.
In a clean pan, heat 2 tbsp oil.
Add turmeric, red chili powder, and salt. Mix.
Pour in the blended paste, add coriander powder, and cook for a few minutes.
Add the fried paneer cubes. Stir gently.
Optional: Add ¼ cup milk and ¼ cup cream. Stir in garam masala and crushed kasuri methi. Simmer on low for 2–3 minutes until thick and creamy.
Turn off the heat. Garnish the dish with coriander leaves, kasuri methi, slivered almonds, and a drizzle of cream.
Serve Shahi Paneer hot with naan, roti, or jeera rice.