Mix the chicken pieces with salt, sugar, red chili powder, turmeric powder, ginger garlic paste, tomato ketchup and yogurt and Marinate for 20 minutes.
Heat ¼ cup oil in a frying pan on high flame and add marinated chicken pieces and fry both side on high flame until golden (around 10 minutes).
Heat 3/4cup oil in a pan and fry the onions and garlic over medium heat until softened but do not brown them. Add capsicum and fry until aromatic. Then add tomato puree, Red chili powder, ginger paste, 2 bay leaves, salt, coriander powder, garam masala powder and mix them well. Cook it for 2 minutes until mixing all the ingredients properly and oil separates.
Now add the chicken into the pan and mix well. Add ½ cup water, Cover and Cook gently on low flame for 15 minutes or until the chicken is tender, stirring occasionally.
Sprinkle the top with green chilies and mix it. Let it cook on low heat for a while.
Sprinkle some fresh coriander leaves and turn off the heat.