Declined calendar events are missing from Calendar (app), even though they show up on search

Setup:

I have set up apple calendar to sync with outlook (Office 365). When I decline a meeting, the meeting vanishes from my apple calendar. I want it to stay there, marked as "Declined".

In Apple Calendar, I have enabled the "Show Declined Events" option in the "View" menu.

In Outlook, I have enabled the "Settings -> Calendar -> Events and invitations -> Save Declined Events -> Show declined events in calendar" option.

Expected: After enabling these settings, I expected that when I decline a calendar invite, the event will stay on the calendar view marked as “declined”.

Actual: When I decline a calendar event, it “disappears” from the calendar view.

Findings:

1. I do see the declined events in outlook web, but they vanish from my apple calendar.

2. If I search Apple calendar for this event, the search bar shows the declined event. The view doesn’t. (Check screenshot for explanation).

3. When I click this search result, nothing happens. Generally, clicking on the search result “reveals” the event on the calendar pane.

4. This did not happen earlier, when my office was using Google calendar. This started after they migrated to Microsoft 365.

Since Office 365 web shows the calendar correctly, they are asking me to connect with Apple support to get this resolved. I have sent a feedback (FB13600296) for this, but I am also requesting the community to help point out if I missed something.