Inspector made a good call. #12 awg wire is good for 25a. in this application and 430.22 would ask for 125% of Table 430.148 which turns out to be 25a. No room to add any more load. See 430.24 The namplate on the motor will give you the actual draw of the motor once it gets running.
How did all you get by 210.23(A)(1)?
Is the "branch circuit ampere rating" 25 because of the wire or 20 because of the receptacle? Is it a really NEMA 5-20? GFCI rated 20? Will a 20a breaker reliably start that motor?
This 1.5HP (20FLA) motor could be troubling, cord and plug connected, if it wasn't 240v.
Of course if that "1.5HP" is just "puffing" and it is really a 15-16a motor ...
...nevermind.