All Scholars of Hadith agree that there is no authentic hadith that shows the importance of 12th Rabi ul Awwal. There are authentic ahadith describing the virtues of the month of Muharram, some weak narrations regarding the month of Rajab, authentic ahadith describing the virtues of Sha'ban and Ramadan, but there is none about Rabi ul Awwal.

There were millions of Companions of our Prophet, who had seen our Prophet صَلَّى اللّٰهُ عَلَيْهِ وَسَلَّم and learned from him directly but none of them gave any special importance to the month of Rabi ul Awwal or performed any specific rituals.

None of the Companions of Prophet considered Rabi ul Awwal as a special month, including AbuBakr, Omer, Usman, Ali and Abu Hurairah. None of the numerous Seerah books mention anything special about this month, too.

 Ayesha said that Allah's Messenger  صَلَّى اللّٰهُ عَلَيْهِ وَسَلَّم used to fast on Mondays and Thursdays.

[Mishkat al Masabeeh 2055]

Prophet of Allah  صَلَّى اللّٰهُ عَلَيْهِ وَسَلَّم  said:

“Deeds are presented [to Allah] on Mondays and Thursdays, and I like mine to be presented when I am fasting.”

[Mishkat al Masabeeh 2056]

The Prophet of Allah  صَلَّى اللّٰهُ عَلَيْهِ وَسَلَّم when asked about fasting on Mondays, said:

It is (the day) when I was born and revelation was sent down to me.

[Sahih Muslim 2606]

Practice of Companions of Prophet:

 The Sahabah loved our Prophet  صَلَّى اللّٰهُ عَلَيْهِ وَسَلَّم and followed him wholeheartedly. Even then, they did not fast on Mondays with the intention of celebrating the birth-day of our Prophet  صَلَّى اللّٰهُ عَلَيْهِ وَسَلَّم. 

Our Prophet صَلَّى اللّٰهُ عَلَيْهِ وَسَلَّم fasted on Mondays for two reasons and that was his exclusive Sunnah, his own way of expressing gratitude to Allah Almighty. The Companions fasted on Mondays, but not with the intention of celebrating the Prophet's birth-day. Even our Prophet  صَلَّى اللّٰهُ عَلَيْهِ وَسَلَّم only fasted on Mondays, none other rituals were observed by him, or his Companions, or Taba'een, or the four Imams, or the Scholars and Historians. In fact, there was no concept of Eid Milad un Nabi in ummah for six hundred years after the death of our Prophet صَلَّى اللّٰهُ عَلَيْهِ وَسَلَّم .

Practice of Muslim Jurists:

Imam Abu Hanifah died in 150 AH. None of his Islamic law books or books of his students like Imam Abu Yusuf Hasan bin Ziyad mention anything about Eid Milad un Nabi.

 Start of Bid'ah: 

 In 600 AH, Dahya Kalbi Abu al Khattab  wrote a book on seerah. He did not mention Eid Milad un Nabi, but he used to recite his book, narrations about our Prophet  صَلَّى اللّٰهُ عَلَيْهِ وَسَلَّم, his physical appearance, virtues and biography, particularly in the month of Rabi ul Awwal.

People continued to increase this practice  such that now it includes lighting, cake cutting, gatherings and much much more.

Every year, there is some new addition to this practice. The celebrations have evolved drastically in the last few years. Unfortunately, there is no link of this celebration with the Quran or Sunnah or the lives of Companions of the Prophet.

Two points should be considered to observe if something really is a part of Deen:

1️⃣ Is it mentioned in the Qur'an or Sunnah?

2️⃣ Did Sahabah practice it?

Distorting the meanings of Qur'an:

Some people distorted the meanings of the Quran.

For example, 

واذکر فی الکتاب ابراھیم

And mention in the Book [the story of] Ibraheem.

❌ Some people distorted the meanings and said: O Prophet ! You should celebrate Ibraheem's eid milad.

This is called:

یُحٔرِّفُونَ الْکَلِمَ عَنْ مَوَاضِعِهِ

Distortion of meaning is a great sin and crime against ummah.

وَأَمَّا بِنِعْمَةِ رَبِّكَ فَحَدِّثْ

But as for the favor of your Lord, report [it].

[Ad-Duhaa 93:11]

❌  If people translate this as:

Gather for milad un Nabi to discuss the favors of your Lord, then it is entirely wrong and a great sin. We should avoid it at all costs.