The council refused to provide some of the requested information it held when a Freedom of Information request was made to the authority.
It stated several reasons for the refusal including health and safety, commercial sensitivity and that information was provided in confidence, according to a report from the Information Commissioner.
The documents were requested by former councillor Adrian Williams – a long-time critic of the council.
He claimed the documents he was sent under the Freedom of Information request were mostly blacked out.
A complaint was made to the Information Commissioner about how the FOI request had been handled and a decision notice, upholding the complaint, has now been issued.
The commissioner's office states that the council must hand over the information within 35 days, adding: "Failure to comply may result in the commissioner making written certification of this fact to the High Court pursuant to section 54 of the Act and may be dealt with as a contempt of court."
It also reveals that AFC Telford United had threatened possible legal action if certain correspondence was released by the council.
The Information Commissioner ruled the council will not have to provide information that constitutes third party personal data.
The authority has the chance to appeal the decision.
It emerged last year that Telford & Wrekin Council had written off nearly £30,000 of business rates for AFC Telford United.
The authority also loaned the club £45,000 to meet critical stadium safety checks. It said Councillor Lee Carter, finance chief at the authority and former managing director of AFC Telford, "played no part" in either decision.
It came at a time when the authority was consulting with residents on plans to make cuts to frontline services because it said it did not have the cash to keep them running.
But at the time, the council issued a statement saying it had long been a supporter of the football club. The authority said in March 2015, the council's cabinet considered a report to look at future opportunities to develop the "successful partnership".
It stated: "As a result of this, cabinet resolved to work with the football club to seek what opportunities for further joint initiatives there were and capital funding of £279,000, from the sale proceeds of the Bucks Head pub on the football club site, was committed to support projects subject to the development and agreement of an acceptable business plan."
Telford & Wrekin Council said that a decision was made by a council director under delegated powers to release some of the allocated capital funding to enable the purchase of a fire alarm and public address system. The authority said without the investment, in the short term, the club might not have been able to maintain the necessary standards to enable them to play football at the stadium.
But the council confirmed a loan was given to protect public funds. It said the 100 per cent business rate relief awarded to AFC Learning Centre and the Bucks Head was consistent with awards made to other sporting organisations in the borough.
Today, Telford & Wrekin Council spokesman Russell Griffin said: "We have received the judgement of the Information Commissioner in relation to correspondence relating to AFC Telford United and we are currently considering it in detail."
AFC Telford was not available for comment.