Heat mustard oil, add onion paste and sauté until light brown in color.
Add sugar, gently stir the sugar until all of it has caramelized into a beautiful golden brown color.
Add the mutton pieces and mix well.Add turmeric powder and red chilly powder and salt.
Fry on a medium to high heat for 10 to 15 min with the lid on.At this point the mutton will start releasing water.
Add some hot water (one ladleful at a time) , mix and cook for 4 to 5 minutes.
Then add some more water in the same amount.Repeat this process until the gravy is turned into a nice brown colour.
Let the mutton cook over low heat covered. Stir in between to prevent from burning or sticking to the bottom of the pan.This process is called "kashano" or "bhuno".
For faster cooking , once you have obtained the desired colour for the gravy you may stop the frying process and tranfser the mutton to a pressure cooker.
First add the fried potatoes.Lay them to the bottom, followed by the mutton on top.
Add 150 g water ,pressure cook it on medium-low heat for 30 minutes.If you are using instant pot , 20 mins in pressure cook mode is enough.Remember mutton will also release water.
Serve hot with steamed rice, luchi, roti, puri, paratha. The typical Bengali way to have this Mutton Curry/Mangshor Jhol is with steamed rice/gorom bhaat.