paneer capsicum recipe | paneer capsicum gravy | paneer shimla mirch gravy

4.84 from 12 votes

paneer capsicum masala recipe - rich gravy dish made with cottage cheese and capsicum (green bell pepper).

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paneer capsicum recipe with step by step photos – this is one of my favorite curry recipe which has cottage cheese and green bell pepper (shimla mirch).

paneer capsicum recipe

this paneer capsicum masala is a rich and delicious gravy made with cream and fried cashew nuts. addition of cream gives a good flavor to this recipe and overall it is a rich creamy recipe which you will enjoy with parathas or rotis.

the paneer capsicum gravy recipe is easy to prepare. first frying the cashews and green chilies. then sauting the onion-tomato masala, cooking the bell peppers and then adding the paneer and lastly finishing off with some cream. apart from recipe, i make few more capsicum recipes like:

tips for making paneer shimla mirch gravy recipe:

  • for onions or tomatoes to cook faster, add a little salt.
  • its better not to fry the paneer as sometimes the process of frying makes them dense.
  • ideally paneer should be added to any recipe just a couple of minutes, before you turn off the flame. if you add them at the beginning of the recipe, they will become dense and rubbery.
  • if you are calorie conscious, you can skip frying the cashew nuts and green chilies. instead add them when you add the capsicum.
  • i will not suggest skipping the cream as it gives a wonderful taste to this recipe. however, you can reduce the amount of cream.

paneer capsicum recipe

its always better to make paneer at home than to buy it from outside. i usually make paneer at stove top. home made paneer is more hygienic as well as cheaper.

the paneer capsicum gravy goes best with rotis, parathas or even a simple jeera rice.

if you are looking for more paneer recipes then do check paneer butter masalapalak paneermalai kofta, shahi paneer and kadai paneer recipe.

paneer capsicum recipe below:

paneer capsicum recipe
4.84 from 12 votes
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paneer capsicum recipe | paneer capsicum gravy | paneer shimla mirch gravy

paneer capsicum masala recipe - rich gravy dish made with cottage cheese and capsicum (green bell pepper).

course main course
cuisine indian
prep time 15 minutes
cook time 25 minutes
total time 40 minutes
servings 3 to 4
author dassana amit

ingredients (1 cup = 250 ml)

  • 150 to 200 grams paneer (cottage cheese) - cubed
  • 1 medium to large capsicum (green bell pepper or shimla mirch) - diced or cubed
  • 1 medium onion - finely chopped OR about 1/2 cup of chopped onion
  • 2 medium to large tomatoes - finely chopped OR about 1 cup of chopped tomatoes
  • 1 teaspoon ginger garlic paste (adrak lahsun ka paste) OR 2 to 3 garlic + 1/2 inch ginger crushed to a fine paste in a mortar-pestle
  • 5 tablespoon fresh full fat curd (dahi or yogurt)
  • 4 to 5 tablespoon low fat cream (25 to 35% low fat)
  • 3 tablespoon oil
  • 10 to 12 cashews (kaju)
  • 2 green chilies (hari mirch)
  • 1 teaspoon turmeric powder (haldi)
  • 1 teaspoon kashmiri red chili powder OR 1/2 tsp of any other variety of red chili powder
  • 1 teaspoon garam masala powder
  • 2 teaspoon coriander powder (dhania powder)
  • 1 cup water
  • 1/2 teaspoon dry fenugreek leaves (kasuri methi)
  • a few coriander leaves for garnishing, optional
  • salt as required

how to make recipe

preparation for paneer capsicum recipe:

  1. heat 3 tbsp oil in a pan or kadai. fry the cashew nuts till golden in oil. 
  2. remove them and drain on paper towels to remove excess oil.

  3. then fry the the slit green chillies in the same oil. remove and drain them too.

making paneer capsicum recipe:

  1. now in the same oil, add the onions. saute the onions till translucent or light brown.
  2. add the ginger-garlic paste. saute till the raw aroma of the ginger-garlic paste goes away.
  3. now add the tomatoes. saute tomatoes till the oil leaves the sides.

  4. add all the dry spice powders. then add yogurt. stir well.

  5. add thinly sliced capsicum. add water and salt.

  6. cook the capsicum till they are tender. this will take some minutes.

  7. when you see oil floating on the top of the gravy, its time to add paneer. stir and mix well.

  8. add cream and stir well.

  9. next add the fried cashews, fried green chilies and kasuri methi.

  10. stir the paneer capsicum gravy and switch off the flame.

  11. serve paneer capsicum masala hot garnished with coriander leaves, with rotis, parathas or rice.

how to make paneer capsicum recipe:

1. heat 3 tablespoons oil in a pan or kadai. fry 10-12 cashew nuts till golden in oil. remove them and drain on paper towels to remove excess oil.

paneer capsicum recipe

2. then fry 2 slit green chilies in the same oil.

paneer capsicum recipe

3. remove and drain green chilies on paper towels to remove excess oil. place them aside.

paneer capsicum recipe

4. now in the same oil, add 1 medium sized finely chopped onion. saute the onions till translucent or light brown.

paneer capsicum recipe

5. add 1 teaspoon ginger-garlic paste (adrak lahsun paste). saute till the raw aroma of the ginger-garlic paste goes away.

paneer capsicum recipe

6. now add 2 medium to large size tomatoes which has been finely chopped. then saute tomatoes till the oil leaves the sides.

paneer capsicum recipe

7. add 1 teaspoon kashmiri chili powder, 1 teaspoon turmeric powder (haldi), 2 teaspoon coriander powder (dhania powder) and 1 teaspoon garam masala powder. stir and mix well.

paneer capsicum recipe

8. then add 5 tablespoon fresh full fat curd (dahi or yogurt). stir well.

paneer capsicum recipe

9. add 1 medium to large size capsicum (simla mirch) which has been thinly sliced.

paneer capsicum recipe

10. add 1 cup water and salt as required.

paneer capsicum recipe

11. cook the capsicum till they are tender. this will take few minutes.

paneer capsicum recipe

12. when you see oil floating on the top of the curry, its time to add 150 to 200 grams chopped paneer (cottage cheese).

paneer capsicum recipe

13. stir and mix well.

paneer capsicum recipe

14. add 4 to 5 tablespoons low fat cream. mix the paneer capsicum gravy well.

paneer capsicum recipe

15. next add the fried cashews, fried green chilies and ½ teaspoon crushed kasuri methi (dry fenugreek leaves). stir the paneer capsicum gravy and switch off the flame.

paneer capsicum recipe

16. serve the paneer capsicum gravy hot garnished with few chopped coriander leaves, with rotis, parathas or tandoori rotis or steamed rice or jeera rice.

paneer capsicum recipe

dassana amit
Founder, Designer, Recipe Developer, Food Photographer ||

i started vegrecipesofindia.com in feb 2009. it is a pure vegetarian blog and shares recipes with step by step photos that will help you to make delicious and tasty vegetarian food easily.

i am passionate about cooking from childhood and learnt cooking from my elders. having a home science degree surely enhanced my cooking & baking skills which i now share as fool proof recipes on the blog. i am trained both in mainstream indian as well as international cuisines.


28 thoughts on “paneer capsicum recipe | paneer capsicum gravy | paneer shimla mirch gravy

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  1. Thanks for sharing it.
    I just did it without water as wanted to have it bit dry to be consumed without any chapati or paratha

    • welcome ketan. water can be skipped in this recipe.

  2. Greetins from the Czech republic.
    Thank you for another great recipe. A tried it today and everyone loved it, as almost all of meals made from your recipes. So thank you again.

    By the way, why did you remove one of my favorite recipe for egg masala?

    • namaste sertralin. glad to know the recipes are turning out good and thanks for sharing your feedback on them. most welcome and happy cooking.
      i removed the egg masala recipe as i was getting comments saying that how come you have egg recipes on a vegetarian site. since some vegetarians have eggs and some don’t. so respecting the thought of these readers, i removed the few egg recipes that were there from the website.

  3. I tried this today.. Made paneer at home and used the strained water here.. I think it added to the taste wonderfully. Didn’t need to add cream at all! And it was as tasty as the restaurant style recipe. Also I read somewhere in the comments to add kitchen masala. Definitely one should! Thanks again for the recipe. Simple and delicious!

    • Welcome Ruchira. Thanks for sharing your positive feedback.

  4. Combination of paneer n capsicum always tastes great. The step 9 of adding water in this recipe got me a bit confused because my experience of adding water to sabzis of capsicum has been that the capsicums lose their sweet taste of frying and yield a little bitter tone on adding water (since I add capsicums right after tadka & fry them a little bit). I’d like to have some gravy in the paneer sabzi. Any idea about why it happens and how to avoid it?

    • ruchi, i never have experienced capsicum having little bitter tones on adding water. never. in fact in so many veg gravies, where i use capsicum, i add water. even when i make capsicum bhaji or sabzi, i sprinkle some water on it and then steam it. what i would suggest is add to not saute or stir fry the capsicum. just add the capsicum and then give a mix. then immediately add water.

  5. My husband loves paneer and asked for a dish with vegetable and paneer. I found your recipe and I knew I could trust it. This recipe did not disappoint. I added a teaspoon of kitchen king and that was the only difference. I don’t eat paneer but hubby gave it 5 stars! Thanks.

    • thanks jen for sharing this. glad to know. kitchen king masala can be added. in fact instead of garam masala, kitchen king masala can be used.