Heat the oil in a frying pan (skillet) over medium heat.
Add the dal and fry for about 1-2 minutes or until they change color.
Then remove from the pan and set aside.
Add the red chillies, coriander and cumin seeds and the asafoetida.
Stir fry for about 1 minute, or until the seeds start to splutter.
Remove and transfer to a blender.
Add the dal, tamarind extract, coconut, garlic paste and season with salt, then process until ground.
Transfer to a serving bowl.
Heat the oil for the tempering in the frying pan over medium heat.
Add the curry leaves, dried red chillies and mustard seeds and stir-fry for about 1-2 minutes, or until they turn dark brown.
Add the onion and fry for about 5 minutes, or until brown.
Add the tempering to the dal mixture and mix all the ingredients together.
Transfer to an airtight container and store for upto 2 days in the refrigerator.
This chutney can be served with dosa or vadas.