Squeeze the grated zucchini and pumpkin to remove the water. Keep that water aside as you can use it later for the gravy.
Mix the rest of the ingredients mentioned under kofta and turn them in balls.
Heat appam pan and brush it with oil. Place the koftas in the pan and roast for 2-3 minutes on one side and further 2-3 minutes on the other side.
Transfer it to a plate.
Heat the oil in a pan on medium heat. Add bay leaf and cinnamon. Once they start to sizzle, add all the remaining masalas, basil and the chopped bell pepper and tomatoes.
Cook the bell pepper and tomatoes for 10 minutes or until they become soft. Remove the bay leaf and cinnamon stick and put it aside. Transfer the remaining mixture to a blender and blend until it gets smooth.
Take the gravy and mix it with coconut milk and the previous water that you had kept aside.
Return the mixture to the pan, add 1/2 - 3/4th cup of water and simmer over low heat for 5 - 10 minutes.
Add the lime juice (optional) and mix well. Add the koftas and cook for 5 minutes or until the sauce thickens. You can garnish it with coriander leaves.
Serve hot... if you plan to serve it later, add some water and reheat before serving.