Gather the ingredients. Slice small onion thinly.
In a mixie, powder green chilli, coconut, salt and pottu kadalai (roasted gram dal) first. Add water again grind.
It should be really smooth. Mix more water and set aside. Heat kadai with coconut oil, temper with mustard, urad dal and curry leaves.
Add sliced onion and fry until it is golden.
Pour the ground chutney to kadai as you keep stirring.
Add more water to mixie and add to the chutney. As it starts to boil, switch off the flame. Keep stirring all the time.
Transfer to serving bowl. Adjust water if needed.