To the chicken, add turmeric powder, red chillies, garlic paste, salt, lime juice and curd. Mix it well. Marinate it for half an hour.
To the pan, add oil and heat it. Saute bay leaf, cinnamon, cloves, crushed black pepper and chopped onions till the onions turn translucent.
Add grated coconut. Saute till coconut colour changes. Add tomatoes. Cook for 10 minutes. Cool and mix it well in a blender.
Heat oil and add the marinated chicken to the pan. Cook for 25 minutes on low fire. Stir regularly. Add paste and simmer on low flame for five minutes.