A review of the particular sections indicates that particular power of inspection applies where there is building work in question or in respect of a building certificate application, which usually arises at the end of the building process. It does not apply in relation to the granting of a development application.
In short, the power granted under Section 119 (2) does not appear to apply to your situation and accordingly, council need to cite some other power of investigation before you should consider yourself obliged to comply.
That said, it is not always wise to stand on your rights too aggressively or else you may find yourself in legal disputation with council, which can be expensive and there is always a risk that some judicial officer will side with council if they feel you are being unreasonable in your refusal to cooperate. With that in mind, I suggest you point out that the provision does not appear to apply, but agree to allow them access at a time and place that suits you, rather than them. If they feel they are on uncertain legal ground they may well just work with you to avoid a dispute they may not win. This way you can minimise any further inconvenience, but avoid the risk of getting into an expensive legal dispute, which even if you win, may cost you a considerable amount of money.
I trust the above assists.
Good luck and please rate my answer.