The offence does exist and has done for ~25 years. The issue is whether that organisation should or should not be banned.
Reasonable suspicion has been tested in the ECHR:
At the time of the arrest, based on the knowledge of the officer - the suspicion of an offence would be reasonable (IMO).
I think the reasonable suspicion point might be a red herring. The police have to act in accordance with the law of the land at the time. It is not for them to second guess whether the Home Secretary acted illegally. The link I provided earlier seems to say that those arrested won't get damages as long Yvette Cooper acted in good faith.
