I've been curious about why transaction had to deal with spending of all inputs on a particular address.
Although I'm not new to the fact that all transaction have to be spent in a single output buy why does it have to work that way??
If you have actually been encountering this problem then it certainly the type of wallet you’re using. The wallet is using all your inputs in one transaction but that’s not how the Bitcoin network works. Wallets like electrum or BlueWallet actually allows you to manage your UTXOs when spending from the wallet. Features like coin control and freezing of utxo are used to manage UTXO.
So the change I'm receiving can I call it an output or a new input ??
If it's not on a new address but on the same address(the received UTXO), will it be counted as part of inputs along with other input when I want to send again to a new address.
The change is also a UTXO, as such it will be used as a new input when making a new transaction, some wallet send the change to a different address which are designated as change address. But you can also have them on the same spending address, As a single UTXO