use warnings;
use strict;

my $old = quotemeta "welcome|to|chennai";
my $new = "Capital of karnataka|is|bangalore";

my $base = ();
my @base = ();
@base = <DATA>;
chomp @base;

foreach $base (@base) {
    if ( $base =~ /$old/ ) {
        $base =~ s/$old/$new/gi;
        print("Replaced!\n");
    }
    print @base;
}

__DATA__
welcome|to|chennai
[download]

The | is a special character in regexes (see perlre). It is used for alternation. The s///g modifier was replacing "welcome" with your $new string, then replacing "is" with your $new string, then replacing "chennai" with your $new string.

I've also chomped your input.