CloudFront functions not working at all

I have a CloudFront distribution that serves static website from an S3.

I have the following function. I have attached this to Viewer Response in my CloudFront default behaviour. My expectation is if I call my CDN domain with some non-existent path, the response should come with status 200 (since I am rewriting the status in this function). But this is not happening and it keeps returning 404.

async function handler(event) {
      var response = event.response;
      var request = event.request;
     
      var uri = request.uri;

      // If API path, do nothing
      if (uri.startsWith('/api/')) {
        return response;
      }
      
      console.log(response.statusCode)

      // Only rewrite on 403 or 404
      if (response.statusCode === 404 || response.statusCode === 403) {
        response.statusCode = 200;
        response.statusDescription = 'OK';
      }

      return response;
    }