Heat Oil in a pan. Add Urad Dal, Chana Dal and dry red chillies Fry on medium heat till the lentils turn golden brown.
Add garlic and onion and fry till onions turn translucent.
Add chopped capsicums.
Add salt. Mix and cover with a lid. On low to medium heat cook the capsicum completely.
Once cooked. Remove from heat and let the mixture cool.
In a mixie jar, add grated coconut.
Extract the juice from the tamarind pulp ( you can do that easily by leaving the pulp in warm water for 5-10 minutes and squeezing the juice out of it once it becomes soft). Transfer this juice to the mixie jar.
Now add the cooled capsicum mixture.
Grind to a fine paste.
Transfer to the serving bowl.
Now prepare the tempering by heating oil in a pan. Add urad dal, asaphoetida, curry leaves, mustard seeds and dry red chilli.
When the mustard seeds crackle, add this tempering mix to the prepared chutney.
Capsicum Chutney is ready.