Silver also slumped on frantic unwinding from speculators.
"Traders are hoping for pick-up in demand as prices fell for the third day and peak wedding season is on..", dealers said.
Standard gold (99.5 purity) dropped by Rs 390 per 10 grams to finish at Rs 30,700 from Wednesday's closing level of Rs 31,090.
Pure gold (99.9 purity) also slid by a similar margin of Rs 390 per 10 grams to conclude at Rs 30,840 as against Rs 31,230.
Silver ready (.999 fineness) plunged by Rs 900 per kg to end at Rs 61,550 from Rs 62,450 yesterday.
In Europe, gold prices traded almost flat on investors cautiousness ahead of a European Central Bank policy announcement amid concerns over US fiscal crisis.
Spot gold bid little changed at USD 1,693.00 an ounce, in early trade, while silver was bid down at USD 32.79 an ounce.