Applicants for a Buddhist temple near Heathcote say they have no choice to take the matter to VCAT, having been refused a permit by the Bendigo council.
Andy Nguyen - the listed applicant, acting on behalf of the property's owners - said the outcome of Monday night's council meeting was disappointing.
He said the property's owners still wished to pursue their plans for the site, which centre around converting a shed into a place of Buddhist worship.
They wanted to use the Ladys Pass property to practice their faith with family and friends, while remaining compliant with regulations.
"I don't see any problem if we go to VCAT. I think we will get it," Mr Nguyen said, regarding the permit.
"We've got to do the right thing and fight for our rights".
BENDIGO councillors have denied a bid for a Buddhist temple near Heathcote after neighbours and city staff raised concerns about "unacceptable" noise and disturbance.
Applicants wanted to turn a shed on private land into a place of worship open on weekends for up to 35 people.
The temple would be disruptive because it would be too close to dwellings, councillor Margaret O'Rourke told fellow councillors when they gathered on Monday night.
"The proximity of the proposal to other dwellings - within 400 metres- demonstrates a lack of separation from that residential use," she said.
Councillor Andrea Metcalf said residents living in a rural area should not reasonably expect the type of noise issues likely if the build went ahead.
"In my opinion the proposed use is not compatible with the proposed use of this site," she said.
Objectors previously told the council their concerns included, noise, traffic, dust, impacts on biodiversity, and a belief the proposal was commercial in nature.
The applicants denied any commercial element to the plans, saying the temple would be a private place for family and friends to gather and practice their faith.
Monday night's council meeting was the first of the new council term and came with a range of changes as councillors put their stamp on proceedings.
They included ditching the opening prayer to God that previously opened council meetings.
Councillors will instead have a moment of reflection as well as an extended Acknowledgement of Country.
Also on Monday night, councillors approved plans for a KFC despite their concerns over the safety of a 'potentially dangerous' Midland Highway and Howard Street intersection.