Q: trying to install iOS 9.3

some upgrades are on "hold" - yours probably is one of 'em

• If you can't activate your iPhone, iPad, or iPod touch after installing a software update - Apple Support 
• Apple pausing iOS 9.3 updates for older devices, working on activation fix | iMore  < this one is likely the pertinent one
• Apple releases new build of iOS 9.3 for users of iPad 2 affected by bricking bug | 9to5Mac 
• If you can’t activate your iPad 2 (GSM model) after you update to iOS 9.3 - Apple Support

Even I am getting the same error for iPad Air

yes - qualifies as "older iDevice"

There have been a couple of articles that I have added to my "list" since last visit:

• Apple Addresses GSM iPad 2 Activation Bug With Revised iOS 9.3, but Broader Issue Remains Unfixed - Mac Rumors
• Troubleshooting iOS 9.3 Update Problems < there are workarounds in this article for some things, including a complicated one to downgrade iOS (I would NOT do this, but that's me)

If I were you, I would try holding Apple's feet to the fire a tad - may not help, but it would make me feel better anyway:

I would Contact Apple Support - AND - file a "bug report" from the menu choice on this form > http://www.apple.com/feedback/iphone.html