Clean and wash the chicken. Add all the ingredients for marination to the chicken and mix well. Leave this for 30 minutes.
To a flat bottom vessel add 3 Tbsp of cooking oil and once the oil is hot add onions and green chilly and fry till the onions are golden brown.
Add ginger garlic paste and fry for 2 minutes and add chilli powder and turmeric powder and fry for 1 minute.
Add chicken and mix well and cook with the lid on for 5 minutes. Mix again to ensure the spices are spread evenly and then add 2 cups of water. Cook with the lid on for 15-20 minutes or till the chicken is cooked.
Add the masala powder and coconut milk and cook on low heat for 10 minutes or till the oil separates.
Garnish with coriander leaves.