Heat oil in a nonstick saucepan and fry the onion and green chili till onion turns light golden and soft.
Then add tomatoes, ginger paste, garlic paste, and mint leaves. Fry till the tomatoes melt, combined with onion and oil starts to separate.
While the tomatoes are cooking add all the spice powders – 1 tbsp red chili powder, 1/4 tsp turmeric powder, 1 tbsp coriander powder, 1 tsp cumin powder, 1/2 tsp black pepper powder, 1 tbsp kasoori methi powder. Stir well and cook till the raw smell of spices turns aromatic. This will take 4 to 5 minutes. While frying the masala keep the flame on lowest and keep stirring in order to avoid burning the spices. In case if the mixture sticks to the pan, add few drops of water.
Now add whisked 2 tbsp whisked yogurt, 1 tbsp tomato puree, 1 tbsp tikka masala and stir well.
Grind cashew nuts and melon seeds together to a fine powder and add it to the gravy.
Remove the gravy from heat, cool it and blend it to a smooth paste. Return the ground paste back to the saucepan and add the grilled chicken pieces along with all the liquid.
Switch on the heat and cook the gravy on low flame along with red food color, chopped coriander leaves, 2 tbsp of butter, garam masala powder, cream and 1 cup of water. More water can be added according to the required consistency. Bring the gravy to a slow boil and keep stirring. Taste and check the seasoning at this point, add salt.
Once the gravy is completely cooked, place a small piece of foil paper in the center and place a hot burning piece of coal over it. Pour a tsp of butter over the coal and immediately place the lid to trap all the smoke inside the saucepan. This process will give the whole dish a tandoori flavor.
After 30 minutes open the lid and discard the foil paper and coal. Serve Chicken tikka masala with rice, pulao or tandoori naan.