It was not part of the original design by Stoner.
Stoner himself thought the forward assist was useless (it is. If your rifle won't chamber a round, something is clearly wrong and smashing the f**king thing into battery so you can put 55,000 PSI through it is a bad idea IMHO)
The US Army (Air Force and Navy didn't care nor the USMC) wouldn't accept the rifle as A1 without it because they insisted every rifle ever made (think the 1903, garand, M14 etc) had to have some way of manually forcing the bolt closed. So Stoner and Armalite added it after the fact.
Also an interesting tidbit for you retro black rifle nuts, the original forward assist that Stoner designed for the rifle after the US Army insisted was actually at the rear of the charging handle.
It was a perpendicular protrusion at the rear of the charging handle you would slam your hand into to force the bolt forward in battery. It got in the way of manipulating the cocking handle so they frankensteined that goofy thing into the side of the upper receiver and cut some notches in the side of the bolt carrier. It was added with much bitterness from Armalite and Stoner to get the rifle adopted A1 by the US Military.
You have the gist of what happened but a bunch of facts mixed up.
Armalite had nothing to do with the forward assist, or the military trials after the sale. By the time the army got around to demanding it, Armalite (Fairchild) was in significant financial trouble, and had sold the rights to manufacture off to Colt's (ironically also in financial trouble) for a song since the army said they would never buy the AR15. That was around 1958. Colt's first run was 1959 with no forward assist yet.
Springfield Armoury (still a state arsenal) created the "spring on the cocking handle" prototype of the forward assist in 1963. There was a small ramp in the upper that forced the spring to enage a detent on the top of the carrier. It used the heel of your hand and worked quite well, but functioned completely differently from the existing one.
Colt's created a handle fixed to the carrier and reciprocated in a slot but was rejected immediately for drawing dirt into the action.
Around the same time, Foster Sturtevant at Colt's created a left hand "thumb closer" forward assist, with serrations on the left side of the carrier, later moved to the right side. I have handled both prototypes and I think stoner was right.
Stoner and the air force did not think the weapon needed a forward assist, but stoner said if they had to have one, it would be the springfield design, because it would be easier to eliminate when they decided it wasn't needed. Stoner did not design either one, but was on the technical coordination committee.
The first run of the XM16E1 with the Sturtevant assist was approved in November of 1963, delivered in 1964.



















































