Heat oil in a pan and add chopped onion in it. Saute for 4-5 minutes.
In the mean time, take a blender jar and add diced tomato, cashew nuts, 1/2 tsp kashmiri chilly powder and puree them.
When the onion turns golden brown in colour, add potato, green chilly and mix well.
Add the chicken, garam masala, pepper powder, turmeric powder, coriander powder, kashmiri chilli powder and saute well for 5 minutes in medium flame.
Add the pureed tomato masala, combine well and add 1/2 cup water.
Bring the curry to a boil, reduce the heat, cover with a lid and let it cook on medium heat for 20-25 minutes. Uncover the pan, and cook for another 10-15 minutes till the water evaporates and the curry starts to thicken. Once the curry is ready, switch off the flame.
Restaurant Style Chicken Gravy is ready now. Let the curry sit for 10-15 minutes before serving. Tastes best with rotis or rice.