Although Lord Siva was aghast at the potency of Lord Visnu, he did not feel ashamed. Rather, he was proud to be defeated by Lord Visnu. Nothing is hidden from the Supreme Personality of Godhead, for He is in everyones heart. Indeed, the Lord says in Bhagavad-gita (15.15), sarvasya caham hrdi sannivisto mattah smrtir jnanam apohanam ca: I am seated in everyones heart, and from Me come remembrance, knowledge and forgetfulness. Whatever happened had taken place under the direction of the Supreme Personality of Godhead, and therefore there was no cause to be sorry or ashamed. Although Lord Siva is never defeated by anyone, when defeated by Lord Visnu he felt proud that he had such an exalted and powerful master.