Cellino failed the Football League's owners and directors' test after being found guilty of not paying import duties on a boat by an Italian court.
However, an independent QC has now overturned that decision, seemingly clearing the way for Cellino to belatedly purchase a majority stake in the Championship club.
In a statement, a Football League spokesman said: "We are disappointed at the outcome of the appeal hearing, however we would like to thank the independent QC for his diligence in reviewing this decision.
"This was never about individual personalities, but instead was a matter in which we were obliged to uphold the integrity of our regulations having considered the issue in detail with our advisors.
"It was always an extremely complex matter in which a different interpretation of a judgment made under Italian law could lead to an entirely different outcome in the context of our regulations. Ultimately this has proven to be the case.
"The independent QC has concluded that Mr Cellino's recent conviction in the Sardinian Court did not involve conduct that would 'reasonably be considered to be dishonest' based on information available to him at the current time.
"The Football League will now consider the findings of the hearing."
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