Turn on a multi-functional pressure cooker (such as Instant Pot®) and select Saute function. Melt butter and cook onion until soft and translucent, about 3 minutes. Add garlic and ginger; cook until tender, about 1 minute. Add chicken; cook until golden, about 5 minutes. Add tomato sauce, coriander, chili powder, salt, garam masala, turmeric, pepper, cumin, and bay leaf. Close and lock the lid. Select poultry according to manufacturer's instructions; set timer for 15 minutes. Allow 10 to 15 minutes for pressure to build.

Release pressure using the natural-release method according to manufacturer's instructions, 10 to 40 minutes.