What would you do? FT situation

[JS 20]

Working a game this past saturday and the coach of the team in question is a highly successful and respected former HS official. Opposing team is shooting 2. I'm the trail, my partner bounces the ball to the shooter. Just as the ball is about to hit the shooter's hands, the defensive player closest to the shooter leaves his lane space and walks towards half court. I signal the delayed violation. Coach goes crazy and says we need to blow that dead and start over b/c the shooter didn't have the ball yet. The shot was good so it didn't affect anything. I'm thinking the black and white answer is that it's a violation b/c the ball is at the shooter's disposal once my partner released it, however from a game management POV, would you blow it dead and start over since he was moving before the shooter caught the ball? Thanks for your input.