Heat oil in a pan on stovetop medium heat.
Add cumin seeds followed by chana dal. Fry for a couple of minutes or until aromatic. Add whole red chillies and fry again for 30 seconds.
Add the quartered shallots and garlic. Cook & fry for 2-3 minutes until aromatic. The pearl onion will turn translucent.
Next, we add the curry leaves and tmarind paste and give it a quick mix for about 45 seconds.
Remove from heat and transfer to a bowl.
Place the same pan back on the stovetop on medium heat. Add raw peanuts.
Drizzle a few drops of oil if required and roast the peanut until golden brown & crisp. [Note: This is the key step to avoild the raw taste. This step takes about 3-4 minutes.
Remove from heat and transfer to the bowl. Add salt. Let the peanut & spice micture cool down a bit before grinding. [Note: Start with ½ teaspoon of salt and add more if required]
Transfer peanuts and spices to a small blender jar, add ½ cup water and blend to a smooth paste. [Note:You might need additional ¼ cup water to grind and also to adjust the desired consistency].