Heat pan, add oil. Once the oil is warm, add the red chili, cilantro, mustard seeds, and dal. Continue to cook on a medium flame stirring occasionally. Cook until the mustard seeds split and the dal turns golden brown, (approx. 3-4 minutes), then add the chopped onion.
Cook until the onion becomes translucent, (approx. 5-7 minutes).
Add tomatoes and frozen coconut. Cook on low heat for 5 – 10 minutes. Turn off the heat. Add the tamarind paste or lime juice. Mix well.
Process in the blender until creamy. You may need to add 2-3 Tablespoons of water. Consistency should be smooth (not chunky).
May be served immediately or stored in the refrigerator for up to one week.