There is a massive difference between HB & CTB in these cases....
CTB (2AR) may be quite legitimately refused as per S. 131 (6) (a) of the SSCBA '92 The condition being; "no other resident of the dwelling is liable to pay rent to the person concerned in respect of the dwelling", (or if there is they are excluded from eligibility from 2AR)...
Otherwise it would appear that the HB section are relying in HB regs 6 & 7, but with out knowing the sub sections of reg 7 (eg 7 (1) (a) etc), it is almost impossible to answer the question without posting a million lines of post as a reply...
However, as an introduction see Commissioners decisions R(H) 1/03 & R(H)3/03 (both of which are available from www.osscsc.gov.uk , and I am sure that are discussed in the discussion forums and have commentary available elsewhere on rightsnet)...
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