Buloke Shire Council said it was with "great disappointment" it had to decline Lachlan Bell permission to run the 10th annual Maitreya Festival had failed to provide council with "necessary information", including planning permits, emergency and traffic plans and liquor licensing approval.

The decision has been met with sadness by the Charlton and wider region business communities.

A petition was launched on Friday calling for the decision to be overturned.

It comes as police were forced to stop the promoter from unloading materials at the proposed site at  Wooroonook Lakes.

The four day camping festival includes international and Australian music, art, dance, swimming and fireworks.

This year's event was to be the fourth staged in Buloke Shire and second at the lake, after the first two were held in Sea Lake.

Charlton real estate agent Allan Getley said he understood council's reasons for declining the permit, but like many residents was disappointed it had "pulled the plug" on the event so quickly.

He said with the shire experiencing a second straight year of severe drought, the festival not going ahead had the potential to put some premises out of business.

"We are working very hard to see how we can have this decision reversed," said Mr Getley, who is chairman of the Charlton Forum which acts as a liaison between council and ratepayers.

"The economic benefits to Charlton and greater Buloke Shire are far too good for it to not go ahead.

"We've had tough times out here and the money this sort of festival can bring into the community in such a short period of time is phenomenal."

The group has not ruled out approaching the state's local government minister to ask her to overturn the council decision.

Mr Getley said businesses planned well in advance for an influx of more than 5000 visitors during the festival and its loss would be felt heavily.

"You look at our local butchers here, we - the forum - run a barbecue on site with all funds going to the local community and sporting groups," he said.

"We have one tonne of meat ordered - that is obviously a considerable order.

"I have an order for over 400 kilograms of bacon from the local supermarket to feed them for breakfast and 9000 eggs from a local supplier."

"These won't go ahead if the festival doesn't happen.

"It's a major economic event and we all need to get to the (negotiating) table and find a way forward.”

Festival organisers have not respond to requests for comment.

Buloke Shire mayor Reid Mather said the community had been let down by a promoter who simply could not get the needed reports and information together to enable his application to be approved.

"Despite council repeatedly listing and requesting the information needed, the applicant did not provide the required information with his application," Cr Mather said.

"This meant that council could not legally approve the Festival at the Lakes and considerable benefit to the community has been foregone. 

"Arts and cultural events are few and far between in the area. I am sure that Charlton, the wider Buloke community and ticket holders feel very let down."

The council is continuing to monitor the site and is working with Victoria Police and Parks Victoria to administer the enforcement process. 

UPDATE 3.30pm: Police have stopped the promoter of the Maitreya Festival from unloading materials at the previous event site at Wooroonook Lakes.

A statement released by council this afternoon said promoter Lachlan Bell had continued to conduct illegal works on the site., despite failing in his bid gain a permit and a licence to stage the festival.

The council is continuing to monitor the site and is working with Victoria Police and Parks Victoria to administer the enforcement process.

Meanwhile, council has branded as false messages being sent from the festival's Facebook page suggesting the event would 100 per cent go ahead.

The Advertiser is seeking comment from Mr Bell.

UPDATE 1.30pm: The president of the Charlton Chamber of Commerce has urged the Buloke Shire Council and the promoter of the Maitreya Festival to reconcile their differences for the sake of Charlton and neighbouring towns.

Peter Gretgrix said a decision to deny promoted Lachlan Bell the required permits would hurt businesses.

"It's tough times right now in a small country town, (but) it's not just about our town," Mr Gretgrix said.

"It's Wycheproof, it's St Arnuad, it's Donald - two of those are in the Buloke Shire.

"It's just silly. How it has come to this, I don't know."

Mr Gretgrix said Charlton businesses were near-unanimous in their support for the event to go ahead.

"It's amazing the response we've had in town," he said.

"A lot of the business owners have gone out and spent money preparing stock and that for the event.

"You have to order things in early - we just thought the shire would look after us and approve it, but it hasn't been the case.

"There hasn't been many objections to it (among the business community).

"Last year it was fantastic for the town - not all of those businesses, but most got some benefit out of it, including 19 different (sporting and community) organisations."

UPDATE 10:40am: Buloke Shire Mayor Reid Mather said he was certain ticket holders and the wider shire community would feel "let-down" that the festival would not go ahead.

"Arts and cultural events are few and far between in the area," he said.

"(But) despite council repeatedly listing and requesting the information needed, the applicant did not provide the required information with his application.  

"This meant that council could not legally approve the festival at the lakes and considerable benefit to the community has been foregone."

It is not the first time promoters of the event have run foul of local government authorities.

Central Goldfields Shire turned its back on the event in 2013 after organisers failed to apply for the appropriate permits.

The event was staged at the Carisbrook Racecourse and Recreation in 2011-12.

A Save Maitreya Festival 2016 - Let's keep it at Wooroonook Lakes, Charlton Facebook page has been established.

Shire residents have begun posting in support of the festival's continuation.

Charlton resident Amber Federiche said the decision to deny the organisers a permit would be a blow to local businesses.

 "Local businesses and the community as a whole were struggling after the January 2011 floods, and the Maitreya Festival was a very welcomed boost to our communities economy -  let alone the thrill and excitement that spread all through the town," she said.

"With nothing else to offer us, why couldn't we just have had this one thing? 

"Great disappointment is a great understatement of what this town is feeling right now."

The Advertiser is attempting to contact the promoter of the event, Lachlan Bell.

EARLIER: Next month’s Maitreya Festival at Wooroonook Lakes will not proceed after Buloke Shire Council declined to issue the required permits. 

Mayor Reid Mather said it was with “great disappointment” the decision was reached, but the council had no choice. 

“The council and the community have been let down by a promoter who simply could not get the needed information and reports together to enable his application to be approved,” he said.