Citizen Outdoor Pty Ltd took the council to the Victorian Civil and Administrative Tribunal after it failed to make a ruling on the digital sign at the busy intersection of Wills and Mitchell Street.

The council told VCAT that if it had made a ruling it would have blocked the project.

The sign will be 2.95 metres high and hang over what is currently a glass atrium window above the main entrance to the building.

More news: New COVID-19 cases as testing clinic reaches capacity

Citizen Outdoor wants to use some of the latest signage technology including sensors that would automatically adjust illumination depending on light conditions.

The sign would show a new image every 30 seconds.

The council told VCAT that the billboard would be out of character with other signage in the area and would dominate in the streetscape.

It also said the billboard would be too close to the heritage-listed former Hopetoun Hotel site across the other side of Wills Street.

The "scale and placement with a scrolling image, would be a distraction by drawing your eye away from the significant heritage building," the council said, according to a VCAT summary.

VCAT member Kerrie Birtwistle rejected the council's argument.

"I do not find that the sign, by virtue of its size, siting or illumination will create a dominant visual element in this streetscape or unreasonably affect the character of the area," she said.

Ms Birtwistle said Wills Street was wide enough that the billboard would not detract from the former hotel building's heritage.

More news: Drunk offender avoids more jail after 'frightening' break-in, assault

VCAT's ruling could have implications for Victorian councils trying to discourage too many promotional and electronic signs, especially when people want to advertise for products or services not offered on site.

Ms Birtwistle said decisions should be made on the merits of each case and that the Bendigo council could do more to differentiate between "sensitive areas" and commercial ones where people might reasonably expect promotional and electronic signs.

Citizen Outdoor's director Wes Randerson welcomed VCAT's decision.

"Not only is it in keeping with the character of the area, it is adjacent to a prominent main road intersection, with commercial properties to all interfaces," he said.

"Vitality and colour, including through the provision of electronic promotion signage, can realistically be expected compared to other locations in Bendigo."

Ms Birtwistle did not believe that the new sign on the intersection would create any road safety issues. Neither did the council or the Department of Transport.

Our journalists work hard to provide local, up-to-date news to the community. This is how you can access our trusted content: