Not 100% sure of my ground on this, but here goes….
[b:5c064bb214]HBR(SPC) 60(5)[/b:5c064bb214] appears to apply.
new.hbinfo.org.com/menu2/pchbregs06/060_06pc.shtml
There is no question of HB being increased – the cap level means that only a decrease could possibly have occurred. So, AA will not have any effect (retrospectively).
My view is that, due to the cap level, HB/CTB is zero from the Monday after the LA received notification from the Pension Service.
The only basis for going further back on the grounds of excess capital would be if you can establish a fraud element (law should not be contrued so as to enable a person to profit from his/her dishonesty).
Regards