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I think it would be a good idea to prevent a user from submitting content to the website if one of their submissions are currently withheld. That way people wont be able to upload new things until they address any withheld submissions they have. This would prevent people from reposting mods that are withheld to circumvent the withhold system, it will also give incentive not to just leave old mods withheld out of lazyness.
Generally speaking a good idea. But I suggest at least that if the new submission is in the same category and sub category as the old one,it should make you fix the old one. In any other cases that shouldn't be the case and in general - if user reuploads his witheld content,he will probably not stop and will get banned in general,so I don't really like the idea.