As others have said, it's not legitimate collateral, the taxi driver is not allowed to keep it, it belongs to the government.
That's debatable, and if fair then so is the removal of the payment for the inconvenience the OP has had by the driver not showing up.
If the original bill is paid and he doesn't return the passport, that's theft.
Also, when the lad didn't have the cash in the first place, I don't suppose the driver agreed an extra charge for having to collect the payment later. It's a fine he's added on top without any legal standing.
Def didn`t steal it, Lad new he had taken it. It`s not a fine. it`s paying for taxi to get his fare and give passport back.
However yes "If the original bill is paid and he doesn't return the passport, that's theft". But the driver only took it as collateral re him being owed fare surely with no intention of keeping it.