Soak cashews in warm water for 15 minutes, then blend into a smooth paste. Soak paneer cubes in hot water to keep them soft.
Heat ghee or butter in a heavy-bottomed pan over medium heat. Add finely chopped onions and sauté until golden brown.
Stir in ginger garlic paste and cook for 1 minute until fragrant.
Add tomato puree, turmeric, Kashmiri red chili powder, and salt. Cook until the oil starts to separate from the masala.
Pour in the cashew paste and cook for another 3 minutes, stirring continuously to prevent sticking.
Add garam masala, kasoori methi, and half a cup of water. Bring the gravy to a gentle simmer.
Gently fold in the paneer cubes and heavy cream. Simmer for 3 to 4 minutes until the flavors meld.
Garnish with freshly chopped cilantro and serve hot with naan or jeera rice.