The present study reports the experimental investigations carried and upgradation of 395 cc air cooled engine to dual fuel (CNG/Gasoline) application. The original 395 cc direct injection naturally aspirated, air cooled diesel engine was first converted to run on Gasoline by addition of electronic ignition system and reduction in compression ratio to suit both gasoline and CNG application. CFX software has been employed to calculate and improve the cooling capacity of engine with the use of CNG. Materials of major engine components were reviewed to suit CNG application. The engine was subsequently tuned with dual multi-mapped ignition timing for bi-fuel stoichiometric operation on engine dynamometer and then fitted on a 3-Wheeler vehicle. The vehicle was optimized on a chassis dynamometer to meet the proposed Bharat Stage-III norms. The engine has passed current BS-II emission norms with 48% margin in CO emission and 76% margin in NMHC (Non-Methane Hydrocarbons) and Extensive trials were conducted on engine and vehicle to optimize with CNG kit and minimum loaded three way cat-con to finally to met proposed BS-III norms.