Active but Terminated Contract

I took a contract with Mr price mobile over the phone, when received the phone it was not as good as it was explained over the phone. After I opened it, I decided to send it back. They collected their phone and told me to pay the cancellation fee, which I did. More than a year later, when I apply for any credit I get told that I owe MRP Mobile and I've been missing payments. Which I don't understand why because I paid the cancellation fee.