I would think that if the smoke is coming from the belt which you say is new, then it's slipping. This could be due to lack of tension (spring missing?). Alternatively, are you sure you have routed the belt correctly? Some mower decks have guide pins to control the belt when the blade is disengaged and it can be easy to get the belt on the wrong side. Also you could check the pulleys rotate freely with side load on them.
Badger
September 2008