However, this does not mean the saga is over.

One of the representors against the proposal, Clarke Greens MP Cassy O'Connor, said the Cambria Green development was one of the "largest, most aggressive developments that has ever been put forward for Tasmania".

The Tasmanian Planning Commission on Friday released its decision to reject the Cambria planning scheme amendment due to major concerns over landowner consent.

In the commission's decision, it said in the absence of satisfactory evidence of landowner permission, the council had no power to initiate the amendment as there was no valid amendment request before it.

"This Commission would therefore be without jurisdiction to hear the draft amendment," it said.

Ms O'Connor said the planning commission made it clear that the former Glamorgan Spring Bay Council failed to do its due diligence.

"What the planning commission identified was there are huge questions over the ownership of those 12 parcels of land, of the nine companies that are registered here and in Hong Kong," she said.

"It's a damning judgement."

Ms O'Connor said the proposal had caused much stress on the East Coast.

"People recognised it was a threat to the East Coast and their way of life, and [now] they are celebrating," Ms O'Connor said. "But they'll be asking questions about how the proposal got as far as it did given the opacity of its company's structure, given the enormous and inappropriate scale of it."

Ms O'Connor said she hoped the proponents did not attempt to submit another development proposal.

"Of course now the proponent may go back to the drawing board and prepare a development proposal which is really clear about who owns the land and whether or not the landowner has given consent for this proposal," she said.

"We're just hoping that the developer recognises this proposal was enormously unpopular, created deep stress in the community, [and] was grotesquely un-Tasmanian."

The planning scheme amendment aimed to facilitate a $140 million tourism development consisting of hundreds of units and villas, a health retreat, golf course, entertainment facilities, crematoria and cemeteries, and educational and occasional care.