If using firm store-bought or refrigerated paneer, place the cubed paneer in a bowl of warm water for 15 minutes to soften. Drain before adding to the curry.

Heat 1 tablespoon of butter and 1 tablespoon of oil in a deep skillet over medium heat. Add the chopped onions, ginger garlic paste, cinnamon stick, and green cardamom pods. Sauté for 4 to 5 minutes until the onions turn translucent. Add the chopped tomatoes, raw cashews, and 1/2 cup of water. Cover and simmer for 10 minutes until the tomatoes are completely mushy.

Remove the skillet from the heat and let the mixture cool slightly. Discard the cinnamon stick if desired. Transfer the mixture to a blender and blend until completely smooth.

Pour the blended puree back into the skillet through a fine-mesh strainer to remove any remaining tomato skin or cashew bits. Place the skillet over medium-low heat, add 2 tablespoons of butter, Kashmiri red chili powder, garam masala, sugar, and salt. Stir well and simmer for 5 minutes.

Lower the heat. Stir in the heavy cream and crushed kasuri methi. Add the drained paneer cubes and simmer gently for 3 to 4 minutes until the paneer is heated through and coated in the sauce. Remove from heat and serve hot.