Take a heavy bottomed kadai and add 2 tbsp of butter on it.(Keep the stove in low flame.)
Allow the butter to melt and give the kadai a slight swirl so that the butter spreads evenly.
Now add the chopped onions to it. Stir it well in the butter till it becomes slightly golden.
Next add the chopped tomatoes to it. Stir it well till the tomatoes goes soft.
Stir well in low flame till you see the butter coming out from the mixture. Now add turmeric powder(½tsp), chilli powder(1tsp), garam masala(1 tsp), corriander powder(1tsp) mix the contents well. After 2 minutes switch off the stove and allow the contents to cool.
Once the contents are considerably cooled, take a blender add the cashews and the now cooled contents to it and blend it to a fine paste.
Heat the kadai. Keep it in low flame and add the remaining butter to it.
Once the butter melts add the cardamoms, bay leaf, cinnamon, cloves to it and slightly roast them.
Now take a sieve and strain the paste slowly into the kadai by adding water from the blender. Panner Butter Masala is a generally a thick gravy hence be careful while you use water to strain it.(If you are bit unsure about straining directly over stove, take another vessel do the straining slowly by adding water till you get a thick puree).
. Now add the remaining masalas(Chilli powder, corriander powder and garam masala) and salt. Stir well and taste it. If you feel the need to add masalas and salt do it little by little till it suits your taste.
Stir well. Now add the panner to it and allow the curry to boil.
Crush a few kasuri methi leaves and add them to the curry(Kasuri methi is optional but adding it gives an additional flavour to the curry.)Add Red food colour in this stage if adding.
Switch off the stove. Add 1 tsp of freah cream to it and stir well.(Freah cream is also optional you can skip it if you don't have it ready.) and Panner Butter Masala is ready!!!
Serve it hot with Roti , Naan or any Indian Breads and enjoy your meal.