The incident happened during Liverpool's 1-0 defeat to Arsenal at Anfield as the Swedish striker had the back of his shirt pulled by defender Jurrin Timber.
Timber prevented Isak from getting to the ball so he couldn't make the intended header, which could have levelled the score.
VAR official Stuart Attwell reviewed the incident but did not recommend an on-field review as referee Andy Madley waved play on.
The KMI Panel voted 4:1 that the penalty should have been awarded on the field, whilst a 3:2 vote said that the VAR should have intervened and sent Madley to the pitchside monitor.
Isak stayed on his feet during the incident and Liverpool manager Andoni Iraola stated that he should not have to go to ground for the decision to be given
"There is a clear grab of the shirt. Alex was just in front of him. He was going to head in front of the goal, but couldn't because he grabbed the shirt. If he goes to the floor, they call the penalty, 100%. It should be like this, but it is what it is.
"Next time, the managers should tell Alex to go to the floor, otherwise they won't call it. The answer is you have to dive. If you don't dive they won't call it."
This is the second time the Reds have suffered in a high-profile game, with Ryan Gravenberch’s sending-off for two yellow cards at home to Man City also being seen as extremely harsh by supporters and pundits alike.