The challenge had been brought by the Daws Hill Neighbourhood Forum (DHNF) which objected to the exclusion of the RAF Daws Hill site and the Handy Cross Sports Centre site from the Neighbourhood Area designated by the Council when it approved the Neighbourhood Plan.
The judge said that the Council had "properly had regard to the specific circumstances that existed at the time when the decision was made to designate a Neighbourhood Area which excluded the RAF Daws Hill site and the Handy Cross Sports Centre".
The judge said that he agreed with the Council's concerns that there was a "mis-match" between the area represented by DHNF and the area it sought to control.
He said that the discretion given to local authorities by the Localism Act to consider whether a proposed neighbourhood area is appropriate is "a broad one".
"The exercise of discretion turns on the specific factual and policy matrix that exists in the individual case at the time the determination is made," he said.
The Council had refused to designate a Neighbourhood Area which included the two sites because it said that any development of the two sites outside the existing "immediate" neighbourhood would "have implications that impact upon a wider sphere of influence" and that there were "larger than local impacts and larger 'communities of interest'".
DHNF argued that, by excluding the two sites, the Council had failed in its duty to act in accordance with the intention under the Localism Act to allow "community input into those development proposals which will have a significant impact on that community" by way of neighbourhood planning.
However, the Council said it had "used its discretion to promote the policy and objects of the Act" by "enabling the development of a neighbourhood plan to guide planning at an appropriate level in that area, having regard to the characteristics of the area and the neighbourhood forum in question".
The judge said that the provisions under the Localism Act give the planning authority a "broad discretion when considering whether the specified area is an appropriate area to be designated as a Neighbourhood Area".
"In exercising that discretion the authority should, in my view, have regard to the particular circumstances existing at the time the decision is made," he said.
"We feel frustrated by this judgement because it is clear that these two development sites in question are an integral part of our Neighbourhood Area - despite claims to the contrary," said the DHNF in a statement.
“We have always acknowledged the 'strategic' nature of both sites, we believe the Localism Act intends for residents to have a greater say in developments in their area that most affect them."
“We also believe that there are sufficient safeguards in the Legislation - and in the processes surrounding Neighbourhood Planning - to ensure that our Neighbourhood Plan, when it came to fruition, would not thwart development of an appropriate quantum and mix at both sites," DHNF said.
"This has been a challenging episode for all concerned as it is such a new and untested area of law," said Wycombe District Council's cabinet member for planning and sustainability Hugh McCarthy in a statement.
"The Judge's decision is important as it will help local councils and communities work within the spirit and intention of the legislation. We are pleased that the judge has confirmed that issues such as those which influenced the Council's decision were right and proper to take into account," he said.
DHNF said it has made a written application to the High Court saying that it is of the view that the judge has misinterpreted the law and that they wish to take the matter to the next stage at the Court of Appeal.