If you have been looking for dinner party recipes, Paneer Butter Masala is the ultimate dish for the vegetarians! Paneer Butter Masala or Paneer Makhani is a popular Punjabi dish consisting of soft chunks of Indian cottage cheese or paneer prepared in rich, smooth gravy laced with lots of butter. The paste of boiled onions and freshly prepared puree from ripe tomatoes are the best base for preparing the gravy.