As per the rules, a legislator winning from two seats has to relinquish one of it within 14 days of the constitution of the new Assembly.
The new state Assembly was constituted last week. Chouhan, who resigned from Vidisha seat on Friday, preferred to retain Budhni - his traditional seat in Sehore district, sources said.
In the run up to the recently held Assembly polls, the BJP leader had announced that he will retain the seat which gets him the higher victory margin.
The 54-year-old saffron stalwart, who was sworn-in as Chief Minister for the third time on December 14, won from Budhni by 84,805 votes - the second highest margin in MP - by defeating Congress candidate Mahendra Singh Chouhan.
However, in Vidisha he faced a tough fight from Congress' Shashank Bhargava and won by only 16,996 vote gap. Vidisha was represented by former BJP minister Raghavji in the last Assembly. Raghavji resigned in July this year over allegations of sexually harassing his domestic help.
It was speculated that BJP fielded Chouhan from Vidisha because of fear of losing the seat, its traditional stronghold, in the wake of Raghavji's episode.