Initial thoughts...
If IB and IS were paid seperately then probably recoverable as, and I'm afraid no references to hand, the obligation is to report changes to the particular department paying the benefit.
However, if IS and IB were paid together (i.e. this is your income support and includes any IB you might be entitled to) then your client has a much better case because IS already knows about the change and a cliamant cannot fail to disclose something of which the department is already aware.
I'm sure you'll find references to both these pionts in the annotation to s.71.
In having a quick look through the annotation though, I found CIS/1887/2002 and CSB/0677/1986 which considered, favourably, similar circumstances as you describe.
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