Chasing 203 for victory, the touring side collapsed spectacularly to lose their last eight wickets in 19 deliveries for the addition of eight runs as they were dismissed for 127 in the 17th over.
Leg-spinner Chahal's figures of 6-25 were the third best in the shortest format of the game.
Earlier, Suresh Raina and former captain Mahendra Singh Dhoni scored brisk fifties to power India to 202-6 after England skipper Eoin Morgan won the toss.
India lost batting mainstay Virat Kohli to a run out early but Raina, who made 63 off 45 balls, and KL Rahul (22) gave the team a good platform with a 61-run stand for the second wicket.
Rahul was bowled for 22 by Ben Stokes but replays later showed the umpire had missed the paceman overstepping the bowling crease.
Dhoni then struck his first T20 international half-century on his way to a 36-ball 56 and with another experienced batsman in Yuvraj Singh flayed the English attack to take India past the 200-run mark.
Left-handed Yuvraj, who hit England fast bowler Stuart Broad for six consecutive sixes in the World Twenty20 in 2007, smashed three sixes and a four in four balls off paceman Chris Jordan in his knock of 27 from 10 balls.
England looked well set to push India close and were 114-2 in 12 overs after Morgan smashed part-timer Suresh Raina for three sixes in an over costing 22 runs.
But they lost their way against leg-spinners Chahal and Amit Mishra and after Joe Root was dismissed for 42 and Morgan for 40 the remaining batsmen all fell cheaply.
Umpire Chettithody Shamshuddin, who had upset England with a couple of contentious decisions in the last game in Nagpur, withdrew from his on-field duties before the toss after complaining of illness.
India also beat England in the test and one-day series.
(Reporting by Sudipto Ganguly in Mumbai; editing by Ed Osmond)
Share
