Is it permissible to donate the value of a non-original phone sold to someone who cannot be reached, with the intention that the reward and merit be for them?

You were wrong to refuse to return the mobile phone to its buyer. If you cannot communicate with him, then donate the price of the phone on his behalf, so that he may receive the reward of charity. This is based on the statement by Ibn Taymiyyah in Al-Fatawa Al-Kubra: "Whoever sells something adulterated is not forbidden from the price except for the amount of the adulteration. So, he must give it to its owner, or donate it on his behalf if returning it is impossible."