If you are using store-bought paneer, boil enough water to cover the cubes and soak for 8 minutes to soften. Drain and set aside.
Meanwhile, heat ghee or oil in a pan over medium-high heat. Add cumin seeds and wait for them to sizzle, about 1 or 2 minutes.
Add onions, sugar, 1/2 tsp of salt, ground coriander, and Kashmiri chili and saute for 8 to 10 minutes. Stir frequently and turn the heat down if the onions are browning too quickly, scraping any bits sticking on the bottom. Also, add a tablespoon or two of water if needed. You are looking for a golden color; don’t rush this step because you are building flavor for the dish.
Add ginger, garlic, and green chili. Saute for 1 to 2 minutes until they no longer smell raw. Add the spinach, mix well and cook for 3 to 5 minutes over medium heat until the spinach is wilted.
Blend this mixture in a food processor or blender until smooth, adding 1/2 to 1 cup of water, as needed. If you have used frozen spinach you probably won't need any extra water.
Add the spinach puree back to the pan over medium heat with the second 1/2 teaspoon of salt, and add milk or cream to get the desired consistency. Simmer gently for several minutes.
Add the paneer and lemon juice; cover and simmer for 3 minutes. Turn off heat and let sit for 10 minutes, so the spices can mix and mingle. Taste for salt, acid (lemon), and heat, adjusting the seasonings to your taste. Add garam masala now if you would like more flavor.
This dish will keep in the refrigerator for 2 to 3 days, and in the freezer for up to 6 months.
If you aren’t using prewashed or frozen greens for your palak paneer, make sure to wash your greens thoroughly to remove the grit and dirt that spinach has. Fresh greens will give you a brighter green color if that is important to you.
Many cooks blanch their greens. This helps set the color for a bright green finish. I do not blanch for three reasons: you lose some nutrients, it takes longer to cook the dish, and I am lazy.
I've added a generous amount of paneer in this recipe. If you want more sauce to paneer, start with at least 6 ounces.
If you don't eat garlic and onions, use a big pinch of asafetida (hing) instead, and add to the pan with the sliced onions.