Firstly, heat a nonstick pan and roast chana dal, and urad dal for 3-4 mins till it becomes golden brown in color.
Additionally, mix grated coconut, roasted chana dal, peanuts, green chilies, salt, and sugar with some water in a blender and make it into a smooth paste.
Further, empty the coconut paste into a mixing bowl.
To make tadka, heat oil in a small pan and add the mustard seeds.
Further, fry till the curry leaves become crisp and the red chilies change color.
Switch off the flame and immediately pour tadka over coconut chutney and mix well.
Finally, serve this tasty coconut chutney with idli, dosa, uttapam, vada, pakoda, or any South Indian Dish.