The Attorney General, however, is also seeking to increase the sentence on the grounds that it is unduly lenient.
Digwa is additionally pursuing a separate legal challenge, seeking permission to appeal against his murder conviction.
As an Indian national, Kaur may also face deportation, though no decision on removing her from the UK has yet been made.
The early release scheme, which took effect on October 1 after a September delay to allow for a review, was designed to ease overcrowding in prisons across England and Wales.
It has drawn significant criticism from the families of victims and those affected by crime.
Ministers reduced the number of prisoners eligible from an initial 6,000 to approximately 5,000 by excluding rapists and the most serious child sex offenders from the programme.
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