The two restaurants are at 7th street and 1st Avenue in the East Village. When you’re walking past the restaurants at dinner time, be prepared to get completely bombarded by both restaurant’s “barkers”– the men who stand outside on the stoop and heckle people to come inside to their restaurant and not the neighbor. It’s a lot like the people who heckle you to play games at amusement parks.
The whole experience with the barkers is bizarre from the start– and then you go inside. Both Panna II and Milon are completely stuffed full of Christmas lights and chili pepper lights. Both restaurants aren’t much wider than a subway car and both are stuffed so full with lights that you can barely stand up. 
While we were waiting for our dinner, we tried to come up with a story for how these crazy restaurants came to be. Theories of brotherly rivalry or a secret shared kitchen where the barkers are just a legend-making marketing ploy were tossed about. The “real” story is that Milon opened in the early eighties and Panna II opened 5 years later. Both were experiencing slow business so the owner of Panna II decided to deck the place out in lights. Even though Milon opened first, Panna II claims to be the original restaurant.
In addition to the lights, the greatest thing about both restaurants is that they’re BYOB. This will save you a heckuva lot of money in this city.
On Panna II’s website, they’ve listed a catchphrase a few times on the homepage: “Where Chili Pepper Lights Meets Christmas Tree Lights.” 🙂
And one other tip– if you’ve got a pal with a birthday, make sure you tell the waiters. I thought the restaurant could not get anymore colorful, but then they turned on the disco ball and sang an Indian version of “Happy Birthday.” While the food is not the best I’ve ever had, I’ll definitely be back. 🙂 
This reminds me of the place that Carrie and Miranda eat at on Sex and the City when Miranda tells Carrie that she thinks she scared Big away. LOVE IT!