California Code, Vehicle Code - VEH § 10804

(a) Section 10803 does not apply to a motor vehicle scrap processor who, in the normal legal course of business and in good faith, processes a motor vehicle or motor vehicle part by crushing, compacting, or other similar methods, if any vehicle identification number is not removed from the motor vehicle or motor vehicle part prior to or during the processing.

(b) Section 10803 does not apply to any owner or authorized possessor of a motor vehicle or motor vehicle part which has been recovered by law enforcement authorities after having been stolen or if the condition of the vehicle identification number of the motor vehicle or motor vehicle part is known to, or has been reported to, law enforcement authorities.  Law enforcement authorities are presumed to have knowledge of all vehicle identification numbers on a motor vehicle or motor vehicle part which are altered, counterfeited, defaced, disguised, falsified, forged, obliterated, or removed, when law enforcement authorities deliver or return the motor vehicle or motor vehicle part to its owner or an authorized possessor after it has been recovered by law enforcement authorities after having been reported stolen.