Not Held ball time out

[OHBBREF]

Worked DIII men's Scrimage last night, there was a loose ball in front of team A bench freethrow line extended - there are three people on the floor and the ball is clearly rolling around with no possession, when a player for team B yells for time out and it is granted by the trail, at this point the ball is now rolling away from the pile up.

As the "C" I clearly saw across the lane that there was no team control or possession and spoke with the trail explaining that there was no possession for either team and no timeout could be granted.
We had an inadvertant whistle and go to the arrow, which left the ball with the offense and no reset of the shot clock. If Team B wanted the time out we would give it to them which they declined.

Question: I was 500% sure that there was never possession of the ball when I stepped in, under real game curcumstances is this appropriate - I was admonished afterward that I should let that one go as it makes Your partner and the crew look bad to blow that simple one.

I am from the schoool better to beat the tape, and get it right.