A group headed by Bendigo woman Julie Hoskin has challenged the mosque's planning permit, arguing the development, which includes sports and education facilities, would bring unwanted traffic, parking, noise and social impacts to nearby homes.

Mimi Marcus, representing Bendigo Council, read out some of the objections received after the permit was approved in June, including those of one Bendigo East woman who cited concerns about noise pollution, traffic congestion and the safety of her family, because "Islam hates Christians."

On the first day of a three-day hearing before VCAT, the Victorian Civil and Administrative Tribunal, Ms Hoskin's group was represented by Robert Balzola, who in 2012 acted for the Concerned Citizens of Canberra in a bid to block a mosque in Gungahlin.

Mr Balzola was also involved in a case against an Islamic school in Sydney's south-west and in October Fairfax Media revealed he was acting for Bernard Gaynor, a man fired from the army over online comments concerning gays, Muslims and women.

In June, Queensland based anti-Islam campaigner Mike Holt told Fairfax Media his organisation, Restore Australia, was responsible for hiring Mr Balzola to represent objections to the Bendigo Mosque. "We're providing a lot of financial help and other help there," Mr Holt said at the time.

But outside VCAT on Monday Mr Balzola said: "I don't even know who they are," when asked whether Restore Australia was involved with paying his legal fees.

Ms Hoskin has maintained that her group was not associated with other residents backed by interstate groups who had mounted aggressive anti-Islamic opposition to the mosque before withdrawing their legal objections.

Those who withdrew included the an administrator of the 'Stop the Mosque Bendigo' Facebook page, Monika Evers, who said she had been vilified and feared for her life after a suppression order bid failed.  

On Monday, an expert witness for the council told VCAT that he believed the mosque was an ideal development for the site.