It hit Touray's arm but it shouldn't have been a penalty, as he was pushed in the back which caused his arm to be where it was and even then, it was so close range that it seems particularly harsh to penalise Touray for that.
Regarding the penalty though, no chance it was offside. It doesn't touch any of their players on the way in and none of them are on the line when the ball goes in. Smart-arse pedant