In bowl take warm milk and yeast and sugar granuals. Keep it aside for 10 minutes.
In another bowl Mix 1 cup sugar, baking powder, and all purpose flour and sieve it.
Now add butter and vanilla essence in mixture of flour. mix it gently.
Add milk and yeast mixture in a flour and make a dough (Make sure Dough is stiff enough that you can shape it easily) , add water if required. Keep it aside for atleast 1 hour (Max 2.30 - 3 hours)
Now, roll it and shape it in a donut shape, spray some water on donut, again rest it for 45-minutes,
Heat oil in a pan, add donuts and fry it till golden brown. let drain in ppaper towel and deep it in a powdered sugar and cinemon mixture. Let the donuts cool completly
In a double boiler add semi sweet chocolate. let it melt. add butter, sugar and milk.
Let iit cool and then deep donut in it and decorate it with different sugar decorations or white/dark chocolate.