Add chili, and cook for 2-3 minutes, stirring occasionally. Add the onion and saute until translucent, about 5 minutes. Add the crushed garlic and ginger and cook for 2-3 minutes, until fragrant. Stirring occasionally. Reduce the heat to low, cover, and cook until the onion is completely softened, about 10 minutes. Stir occasionally to make sure bottom doesn’t burn.
Add the tomato puree. Stir well and cover again. Cook until tomato looks like it’s almost separating, and is reduced in volume by half, about 10 minutes.
Add the coriander and paneer masala. Stir well. Add the red bell pepper and cook until the pepper is half-cooked, about 5 minutes. Add the salt, cover again, and cook for another 5 minutes.
Add the heavy cream. Stir well, then add the cubed paneer and cover. Cook for 25 minutes all the ingredients are tender.
Garnish with cilantro and serve with naan or rice.