As gunman Man Haron Monis opened fire on hostages fleeing Sydney's Lindt Cafe, senior police believed he was aiming above their heads and decided not to storm the building.
Just minutes later, a witness who had escaped the siege told officers Monis had "fired (a) shot at them as they left".
An official police log was updated to reflect the shot was "fired at hostages and shattered glass".
But Assistant Commissioner Mark Jenkins, who was in command at the siege when the shot was fired at 2.03am on December 16, 2014, says he was never told of the advice.
Mr Jenkins told an inquest on Tuesday he was not watching security footage of the unfolding crisis from his position at the Police Operations Command centre, or taking advice from anybody who was.
He said he had considered - and rejected - the possibility Monis had shot at the hostages and missed.
Instead, Mr Jenkins said he was relying on information from officers on the front line.
"The information made available to me at the time was that the shot was high and not aimed at the hostages," he told the inquest.
Mr Jenkins said he was convinced the gunshot did not pose a serious enough risk to hostages to warrant sending officers in to storm the building.
"I was satisfied it was a situation which was ambiguous enough that an EA (emergency action) shouldn't be considered at that moment," he said.
Mr Jenkins' evidence puts him at odds with Assistant Commissioner Mark Murdoch, who he replaced as siege commander.
Mr Murdoch earlier this month told the inquest he would have expected an emergency action to be triggered when the first shot was fired.
Mr Jenkins was repeatedly pressed to explain why he'd told a superior officer Monis had "deliberately" aimed high.
"I think that was my construction of the situation," he told the inquest.
Monis fired a second gunshot inside the cafe at 2.09am, but Mr Jenkins said he was never told.
"I only found out about that shot maybe a month and a half ago," he said.
Just four minutes later, at 2.13am, tragic news reached police: "shots fired, hostage down".
It took officers just 59 seconds to storm the building after Monis shot cafe manager Tori Johnson dead at point-blank range.
Lawyer Katrina Dawson was killed by shrapnel from a police bullet as they opened fire and shot Monis dead.
Mr Jenkins was repeatedly pressed to explain why an emergency action wasn't triggered sooner, telling the inquest it was not his role.
"You're saying, in practical terms, it really was not your call?" counsel assisting the inquest Jeremy Gormly asked.
"No, it wasn't," he replied.
Mr Jenkins said that right up until the last moments of the siege he was confident it would end peacefully through negotiations.
"(I was) more optimistic in the five minutes before that first shot than I'd been all night," he said.
