On CI, the offense has the option of taking the play or the penalty (unless the batter and all runners advance -- in that case the CI is ignored entirely).
You have outlined the result of the "play" -- a foul ball. And, it doesn't matter whether the mitt or the ball was struck first (although it's hard to come up with an example where the ball would be hit first).
So, the offensive coach can choose (a) a strike on the batter and runners return, or (b) Batter to first, runners return unless forced.
Most of the time, option B will be better.
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