1. When you hypothecate the Vehicle in favor of the Lending Bank, by virtue of a Loan Agreement, THEN you do not remain the absolute owner, till the hypothecation is lifted, on the documents, which is possible only when the Loan is fully paid.
2. By virtue of the Surrender note of the Vehicle, you have voluntarily relinquished your rights on the Vehicle and the Lending Bank, becomes entitled to dispose of the Vehicle, without any further reference to you, more so specifically due to your Surrender Note. Hence now you will not be able to claim any adverse claim on the Vehicle and now you have become liable for the residual Loan amount that the Bank was not able to recover, after disposal of the Vehicle.
3. You may raise a dispute on the Bank's Sale-Price of the Vehicle and try to deflect the Banks claim on the remaining Loan amount.
Keep Smiling .... Hemant Agarwal