First, rename your variables so that the names connote meaning.
Use a try-catch block to capture the exception.
The following rewrites your code. When the exception occurs, you will be provided with an indication as to what caused the error. My guess is that your source file does not exist. This in turn implies that your test for existence needs to be made against the source rather than the destination (as you have now).
string destination_filename = Application.StartupPath + "\\Preseaintake\\newtest.xls";
string source_filename = Application.StartupPath + "\\Preseaintake\\test.xls";
string backup_filename = Application.StartupPath + "\\Preseaintake\\backup.xls";
try
{
if ( File.Exists ( destination_filename ) )
{
File.Replace( source_filename,
destination_filename,
backup_filename );
MessageBox.Show ( "Replaced" );
}
}
catch ( Exception ex )
{
MessageBox.Show ( ex.Message +
Environment.NewLine +
ex.StackTrace );
}