Soak the saffron in hot milk for 15-20 minutes.
Cut the paneer into cubes or long slices, whichever you prefer.
Sprinkle 1 tsp Kashmiri Red Chill Powder and ½ tsp turmeric powder on the paneer.
Toss to coat the paneer pieces.
Let it rest for 15 minutes.
Whisk the yogurt to a smooth consistency and keep on the side till required.
Heat ghee in a wide frying pan over medium heat.
Shallow fry the paneer pieces in the ghee. Don't let the paneer become too brown. It should be a light golden brown in colour.
Keep the paneer on the side till required.
In the remaining ghee add cardamom, cloves, cinnamon, bay leaf and coriander seeds.
Let the spices sizzle in the ghee for a few seconds.
Add the finely chopped onions. Stir fry them till they become soft and become very light brown in colour.
Add minced ginger and garlic. Stir fry for a few seconds.
Add the rose petals and stir for a few seconds.
Add tomato puree. Mix well and cook for a few seconds.
Add ¼ cup water. Simmer the gravy till it becomes a bit thick.
Add remaining turmeric, kashmiri red chilli, red chili powders and salt.Mix well.
Cover the pan and cook the tomato gravy till it becomes thick.
Add the yogurt and keep mixing so that it does not curdle up till the gravy becomes hot.
Add garam masala.
Add the saffron infused milk. Add rose water and mix.
Now add the lightly roasted paneer.
Mix well, cover the pan and allow the curry to simmer for 3-5 minutes on low heat.
Add cream and chopped coriander. Mix well.
Paneer Kundan Kaliyan is ready for serving. Enjoy it with some naan, rice or paratha.