The authority revealed its plans last month before Coun Stuart Richardson, portfolio holder for regeneration and growth, took a delegated decision to declare the site redundant.
Council documents state the car park features 19 spaces, four of which are for disabled residents, but their loss would not impact the vitality and viability of the town centre.
The nearby Walkden Street car park, which has undergone a renovation, includes 352 spaces, while the wider town centre has 88 spaces for disabled motorists.
Planning documents, approved this week, state the site will now be converted into an ‘urban green space’, featuring a paved terrace and landscaping, bordered by railings and planting.
There will also be planting to the rear of the Town Hall, with a stepped garden on the site and a memorial feature at the heart of the park.
Coun June Stendall, who represents Grange Farm, said: “It’s nice to see some part of our town take on some green space and it will be nice to see it come to fruition.
“The town centre does lack some green space for the people who do and are going to live in it.”
Councillors were told that the site was initially created 12 years ago as a temporary car park, with documents revealing that it made a three-year average income of £19,995.
However, the meeting heard concerns from a shopkeeper on Queen Street who opposed the plans.
Stephen George, who runs the Partytime store overlooking the car park, told councillors: “That car park is used every day and is always full.
“We, as shop holders, have nowhere we can unload because of two taxi ranks, one the full length of Queen Street, and disabled parking.
“It is stopping lorries getting around. I have to get all my deliveries up to Newgate Lane and then bring them down in the van.
“The only thing it’s going to encourage is drug users congregating there, which they already do.
“I’ve spoken to a lot of the shopkeepers and I haven’t heard anybody in favour.”
These concerns were also echoed by one councillor in the chamber.
Coun Barry Answer , who represents the Abbott ward, said: “I support a lot of what the speaker has just said.
“I think it’s an extremely useful little car park for people to nip into town and use the bank. It’s very close by.
“It’s a bad move that we want to put a postage stamp park right at the back of the Old Town Hall.
“It’s a backwards step changing it over from what it is now.”
The plans were approved by nine votes to one.