Heat 1 tablespoon of oil and butter in a pan over medium heat. Add cumin seeds and let them sizzle. Add the chopped onions, ginger paste, garlic paste, and green chilies. Sauté until the onions turn light golden brown.

Add the chopped tomatoes and drained soaked cashews to the pan. Cook over medium heat for 8 to 10 minutes until the tomatoes turn soft and pulpy. Remove from heat and let cool slightly.

Transfer the cooked onion-tomato mixture to a blender and blend until completely smooth. Strain the puree through a sieve back into the pan for a velvety texture if desired.

Place the pan back on medium-low heat. Stir in the Kashmiri red chili powder, turmeric powder, coriander powder, salt, and tomato paste. Cook for 5 minutes until oil begins to glisten at the edges.

Pour in the water and heavy cream, stirring continuously. Add the grated paneer and paneer cubes. Simmer gently for 4 to 5 minutes until the paneer is warm and absorbs the flavors.

Crush the kasuri methi between your palms and sprinkle it over the curry along with the garam masala. Stir gently, turn off the heat, and serve warm.