The police say it was "unwise" to taser a man through the window of his car before shooting out his tyres in a busy supermarket carpark.
A report from the IPCA found the actions unjustified and the attempted arrest in Whangārei poorly planned.
On the afternoon of 3 March 2022, the police attempted to arrest the 38-year-old man who was wanted for a series of burglaries.
The suspect was spotted by police while he was driving and they followed him to a busy shopping centre in Whangārei, where he parked.
The man was able to drive out, crashing into several cars in the carpark in the process.
As the man was attempting to drive away, an officer fired two shots from his pistol at the car tyres and two officers fired tasers at the man.
Despite significant damage to his car, the suspect escaped and was later arrested in Auckland.
The police watchdog concluded the officer was not justified in firing the shots from his pistol.
The report said the risk of death or injury to members of the public, including women and children in the vicinity, far outweighed any risk the man posed.
The IPCA also concluded that the officers were not justified in using their tasers as it was against police policy and made the incident more dangerous because of the risk of the man losing control of his car in the busy carpark.
The report found police failed to investigate the matter adequately.
"Police found that firing the pistol was an 'extremely risky course of action', and firing the tasers was contrary to policy. However, they took no action against the officers involved [in the arrest attempt]," it read.
IPCA chairperson Judge Colin Doherty said attempting to arrest a man in a busy shopping centre carpark resulted in the inappropriate firing of the pistol and tasers.
"The fact that no one was injured, or even killed, in this incident is remarkable and owed entirely to luck," Doherty said.
"I am disappointed that despite the officers acting contrary to policy and placing members of the public at significant risk, police have entirely excused their actions."
'It was unwise' - police
Through a statement, the police said they accepted the findings of the report.
Northland District Commander Superintendent Tony Hill said the circumstances and actions in the first attempt to arrest the man were unfortunate.
"The police staff involved in this incident were acting with good intent to apprehend an offender, actively committing offending, and who may have been in possession of a firearm," he said.
"Police accept that the tactics employed at the time were unwise and not in line with our policy or public safety."
Hill said a review was completed into the operation and the police identified several opportunities to improve, including safety procedures and additional training.
"The IPCA's report also notes these changes have been implemented and are already being used in combined operations by the groups concerned."