Can a research group be formed without a PhD in charge? In my place of work, which has a very incipient progress in the field of research in Computer Science, has occurred this dichotomic situation:


It has arrived one lecturer that has finished his PhD students in a foreign country. Because he has some research already on the way from his doctoral studies, he has formed a research group within our Faculty.
There is another lecturer that has only a Master degree, also in CS, but he has some good ideas but he suffers from imposter syndrome.


In this situation the former group minimizes the attempt of the second group to form a research group; stating things like "a research group to be successful should always be led by a doctoral graduate if not is doomed"

The question is, is it needed to have a doctoral researcher inside a research group (sorry for the redundancy)? or in what ways we should encourage the formation of research groups even though they are not lead by a PhD graduate?
A PhD is a degree supposed to develop (and later demonstrate) the skill of being capable and ready to do independent research. The degree to which that is achieved can vary massively, depending on institution and supervisor. 

It is quite possible (and not at all improbable) that a non-PhD person can outshine the PhD person, but, per default, the latter enjoys a priori the expectation that they know more about the process of doing research than the former. However, this is no reason at all not to form a group of interested people, with or without PhD. A PhD member is not a guarantee of success and the lack of one does not presage doom.

The case you mention seems to be of someone who does not want to see a competing group being created (depending on the convention of your location). That being said, make sure you have knowledgeable people in the group. The reason why many countries have a research group led by a professor (not just a PhD) is that the latter not only know how to do research but have had a broad exposure to many methods and perspectives.

Good luck!