Your question links to an article that quotes the relevant law. The law makes it pretty clear that, to answer the question in the title: yes you can be put in jail for refusing to provide a decryption key for encrypted data.
This is a significant reversal of the presumption of guilt. To quote:
For the purposes of this section a person shall be taken to have shown that he was not in possession of a key to protected information at a particular time if— (a)sufficient evidence of that fact is adduced to raise an issue with respect to it; and (b)the contrary is not proved beyond a reasonable doubt.
In other words, it's not a defence to simply say "I don't have the key". You are presumed to have the key unless you can provide some evidence (not necessarily proof) that you don't have it. (With apologies to @Konrad Rudolph, who originally held this view and I disagreed with him)
With that single exception, nothing else in the law appears to override the basic legal principle that you have to be shown to be guilty in a court of law. The police have to show that there is encrypted data in order to show that you failed to provide a key to it. If you have (unencrypted) astronomical data on your laptop, then the burden of proof would still be on the police to show that it was encrypted data. And anyway, the case would still be tried in a court of law. The police can no more send you to jail because they think you have encrypted data than because they think you committed a murder. A court can send you to jail if it can be proved that you have encrypted data, you refuse to disclose the key, and you can't show that you don't have the key..
To answer the question at the end: No you cannot be put in jail just because the police think you have encrypted data.