Marinate the Chicken: In a large bowl, whisk together the yogurt, ginger garlic paste, lemon juice, Kashmiri red chili powder, cumin, turmeric, salt, and mustard oil. Add the chicken pieces and rub the marinade into every piece. Cover and refrigerate for at least 1 hour, or up to 8 hours.
Make the Chaap Paste: Drain the soaked poppy seeds and cashews. Add them to a blender with the charmagaz, green chilies, and warm milk. Blend to a completely smooth, thick paste. Set aside.
Caramelize the Onions (Beresta): Heat the ghee and oil in a large, heavy-bottomed pot over medium heat. Add the sliced onions with a pinch of salt and cook 12–15 minutes until deep golden brown. Remove and set aside, keeping the flavored oil in the pot.
Temper the Spices and Sear: In the same flavored oil, add bay leaves, cinnamon, cardamom, and cloves. Sizzle 30 seconds. Add the marinated chicken with all the marinade and sear 8–10 minutes until lightly browned.
Build the Chaap Gravy: Stir in the chaap paste, Kashmiri red chili powder, garam masala, and salt. Cook 4–5 minutes until thickened. Add caramelized onions and warm water. Simmer covered on low 30–35 minutes until chicken is tender (165°F / 74°C).
Finish Like Kolkata: Uncover and stir in fresh cream, kewra water, rose water (if using), and the final tablespoon of ghee. Simmer 3–4 minutes until thick. Garnish with cream, fried onion strings, and cilantro. Serve hot.