"Accused David Headley is tendered pardon as per section 307 of Code of Criminal Procedure....Headley would be the prosecution witnesses in the case," said the judge G A Sanap.
Headley will depose through video conference on February 8.
The court added that pardon was being granted on the condition that he would reveal "every fact".
"He shall reveal all true facts leading to the conspiracy of terror attacks and also details of all the co-accused involved in this matter and crimes committed in India by him and others as per his knowledge," the judge said.
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From the order of the US court, which convicted Headley for his role in 26/11 conspiracy, it can be seen that the plan could not have reached its logical end without his involvement, the judge noted, saying this was one of the aspects to be considered while tendering pardon to Headley.
The conspiracy was hatched outside the country and LeT operative and 26/11 key plotter Sayed Zabiuddin Ansari alias Abu Jundal, who is currently facing trial before this court, was Headley's co-conspirator, but there is no direct evidence (against Jundal), the court noted.