The Government has stepped in to settle a row over a new £40m council headquarters.
Northumberland County Council approved the plan which included 200 houses, shops and a school at its current County Hall site.
The authority said selling off the land and erecting a new £40m building in Ashington would be more cost-effective than refurbishing the current building.
But Morpeth Chamber of Trade chair Jacky Beesley said it was 'unsatisfactory that the council was both the planning authority and the landowner that would benefit from approvals'.
A local residents group said the proposals went against a strongly-supported neighbourhood plan which made clear the site was not suitable for retail and housing.
Secretary of state Sajid Javid will now make a decision after a public inquiry, the Department for Communities and Local Government confirmed.
The council admitted it was 'clearly a contentious issue' but said it could not comment further because it was in purdah ahead of local elections in May.