Soak saffron in 1 tablespoon of milk and set aside.
Boil cashew nuts in 1 Cup of water for 5 - 10 minutes. Blend to a smooth paste and set aside.
Heat ghee in a heavy bottom pan. Add bay leaf, and cardamom. Fry for 1 - 2 seconds.
Next, add the chopped onion, ginger, garlic, green chilli and fry till onion is golden brown in colour.
Add spices, salt and cook for 1 - 2 minutes. Turn off the heat and grind the masala to a smooth paste.
Once again, heat pan, add onion paste, cashew paste, and milk. Stir to combine nicely.
Add salt, spices and allow the gravy to simmer over low heat for 5 - 10 minutes. Adjust the consistency of gravy by using water if it seems too thick.
Once you are ready to serve, add the deep-fried kofta in gravy along with saffron milk. Stir gently to combine. Simmer paneer kofta curry for 3 - 5 minutes. Turn off the heat.
Serve Paneer Kofta Gravy with naan or paratha.