The Co-op, which has a store nearby, has already failed at the High Court and yesterday went to the Court of Appeal, where a top judge kicked out its "unarguable" challenge.
Sir David Keene's decision paves the way for the development, at a former industrial site in Station Road, to go ahead.
Co-op barrister, Richard Harwood, argued that, in considering Tesco's planning application, Tendring District Council made a host of omissions and errors.
He criticised the council's assessment of the impact on retail outlets in the town centre and the way environmental considerations were dealt with.
The council made no reference to the Suffolk Coasts and Heaths Area of Outstanding Natural Beauty (AONB), which is due to be extended to the shore of the River Stour nearby, he said.
And it did not inform government heritage watchdog English Heritage of the application, meaning the decision was made without knowing what its stance on the development was.
Giving judgment, Sir David said he agreed with Mr Justice Sales, who rejected the Co-op's bid to judicially review the grant of planning permission in April.
"I simply cannot accept that the committee overlooked the relationship of this site to the AONB, as existing and proposed, and to the River Stour," he said.
"There is evidence that committee members visited the application site before the decision was made and that members were familiar with the proposed AONB extension.
"Moreover, the report to committee went into great detail as to the design of the Tesco scheme and the likely impact of it on long-distance views.
"The reality is that the visual effects of this scheme on the area and its surroundings were considered with great care."
The Court of Appeal application was refused.