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Ruling on an insufficient bid

At IMPs the auction went as follows

Nortn dealer none vul

West   North  East  South

  --        1       P      1NT

  2NT    2      

North South were playing a strong club system where 1  was limited to 16 HCP and

1NT was forcing. North volunteered to make the bid sufficient but after some discussion

the director was called. He took North away from the table and asked him  whether the 2

call was a mechanical error. North said no, he did not see the 2NT call. The director then

asked him whether he would have bid 3 had he seen the 2NT call. North said most likely

not. The director now ruled as follows. North may either Pass in which case South would

be barred for the remainder of the auction or he may bid 3 in which case  South would 

be barred for one round. In either case, should East West buy the contract, there would 

be lead penalties regarding the heart suit. The director did not refer to any specific rule

when making the ruling. He is a well-known, competent director and there is no reason to

assume that he ruled but as best as he knew. The discussion between him and North is

as it was related to me by North. I discussed the incident with the director later and he

told me that if North chose to pass South would have received unauthorized information

regarding North's hand strength, that is North did not have the values for a 3 call. 

I have never been involved in a similar situation  What do you think of the ruling?

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