In today's environment of global competition where each company is trying to prove itself better than its competitors, software company have to continually do up-gradation or add-ons in their software to survive in the market. Each succeeding up-gradation offers some innovative performance enhancement or some new functionality etc distinguishing itself from the past release. But at the same time the amount of risk involved in up-gradation/add-ons of software with regard to introducing new faults or increasing the fault number in the software is also formidable. This model categorizes faults in two types: Type-1 and Type-2 (simple fault, hard fault namely) with respect to time which they take for isolation and removal after their observation. In this paper, we propose new model and new concept of multi release software development environment. The model developed is validated on real data sets for software which has been released in the market with new features.