File or grind the outer edge of the top of the steerer tube a bit, and put some lube on the "o" ring inside the cap. Then carefully work the cap down the steerer tube - don't use a punch (Jeez, it's a quality component). I have sometimes with King headsets used a crown race setting tool and Park crown race installation tool to work the cap down. The issue is the King headset is built to greater tolerances than most steerer tubes. I just installed one on a Soma Smoothie Stainless Steel frame with a Ritchey fork and had to perform quite a bit of prep work on both the headtube and fork steerer to obtain a proper result.
PS: The star nut looks crooked in the steerer tube which will cause other problems with the headset/top cap/adjustment.