First, Soak 400 grams of paneer in warm salted water for 15 to 20 minutes. This will help defrost and season the paneer, making it nice and tender.
After socking, take 2 tablespoons of oil and 1 tablespoon of butter into a cooking pot. When the oil becomes a little hot, add 2 whole bay leaves, 4 pieces of cardamom, and 6 pieces of cloves. You can skip the oil and prepare the whole dish in butter only.
When they start to release their aroma, add in some ginger slices, garlic pods, and onion slices along with green chili. Fry everything up for a few seconds before adding in some cashew nuts and chopped tomatoes. Season with salt and cook for 2 to 3 minutes on medium heat.
Once the mixture has cooled down a bit, remove the bay leaves and blend it into a smooth paste in a mixer blender pot. Set the paste aside for now.
Before we move on to the next step, be sure to drain the water from the paneer and set it aside for later.
In a curry pot, heat up 1 tablespoon of oil and 1 tablespoon of butter (or just 2 tablespoons of butter). Add in some finely chopped onion and fry until it's golden brown. Then, add in some Kashmiri red chili powder, coriander powder, and turmeric powder. If needed, add a little bit of water to make a nice mixture. Finally, add in some salt and cook until oil comes to the top.
Now add the masala paste (prepared earlier) to the tempering. After mixing everything well, add ½ teaspoon garam masala powder. Mix again. Pour little water. After a good 1 minute of mixing, add ⅓ Cup fresh cream to the gravy.
Add some dried fenugreek leaves and chopped coriander to the mixture, and then add in the paneer cubes. Mix everything together well and add a little bit of water if needed to get the right consistency. Put the lid on and cook for 2 minutes on low to medium heat.
And there you have it - a delicious and creamy Paneer Butter Masala!