Peel and dice the carrot. Deseed the peppers and cut into large chunks. Peel the shallots. Peel and dice the onions. Cut the beef into 4-5cm large chunks. Sprinkle the meat with some salt.
Take a large enough pan, bring it to high heat and sear the meat in olive oil. While the meat is frying add some more salt and black pepper. Once done remove the meet. Now fry the shallots and onions at medium heat. After about 5min add the carrots and peppers and continue frying for another 5min.
Add the meat and all other ingredients; red wine, beef stock, tomato puree, paprika, chilli and bay leaves. Stir well and place the lid over the pan. Let the Gulasch simmer for 2 hours. Before serving remove the bay leaves.