If you want to use the Induction kit, you will need to remove the air filter. I had a K&N 57i kit on my old 1.8 Spi Driver for a couple of months, but took it off as it proved to be more trouble than it was worth. (started running rough and power was peaky). My advice would be to get a Panel filter and drill your airbox - then you get increased flow and a bit of extra growl.
Cheers