inbounds question

[eltgabs]

On a full court inbounds pass the ball hits a flag hanging from the rafters and the ball falls to midcourt. The referees determined that it was a dead ball and awarded the ball to the opponent at the same spot (under their basket). This ruling sounds valid to me, but my questions are: A) Was this the correct ruling? B) If the ruling was correct, where in the rule book could this be referred to ? C) If the ruling was incorrect, what is the correct ruling?

Thanks in advance for all responses