Taking the documents of the students is a great way to to block students from going to other colleges.
Now I have heard a case from my seniors that one boy from BIT had got chance in IIT after taking a partial drop from BIT but when he asked for documents he was forced to pay all the 4 year tuition fees of the college to get the documents back.
The logic is that if you are leaving the college in second year the college cannot take another student at your place thus there will be problems if you want your documents back. If you are still in 1st year 1st sem there will be no problem but if you have gone in second year then there will be problem.