When you use the Add Files tool to attach a new version of a file to a document, the Add Files tool acts like the Check-In feature adding a new version of the files to the Catalog. In order for this to work, the filename, Project, Folder, and Source Contact (if any) of the new version must match the existing information of the file already in the Catalog.
For example, if Project GC-003 already has AcmeMeeting.doc in the General folder, and you upload AcmeMeeting.doc again in the General folder of Project GC-003, both versions of the file will be kept in the Catalog, the one you just added being the “latest version”. However, if you had another file entitled AcmeMeeting.doc associated with a different project, both files will appear in the Catalog as distinct files.