variable "create_vm" {
  description = "If set to true, it will create vm"
   type   = bool
}

variable "create_vmss" {
  description = "If set to true, it will create vmss"
  type = bool
}

and define the resource azurerm_linux_virtual_machine and azurerm_linux_virtual_machine_scale_set in the same VM module.

resource "azurerm_linux_virtual_machine" "example" {
  count   = var.create_vm ? 1 : 0
  name                = "example-machine"
  resource_group_name = azurerm_resource_group.example.name
  location            = azurerm_resource_group.example.location
  size                = "Standard_F2"
...

resource "azurerm_linux_virtual_machine_scale_set" "example" {
  count               = var.create_vmss ? 1 : 0
  name                = "example-vmss"
  resource_group_name = azurerm_resource_group.example.name
  location            = azurerm_resource_group.example.location
  sku                 = "Standard_F2"
  instances           = 1
  admin_username      = "adminuser"

....
Then call the submodule like this,

module "vm" {
  source = "./modules/vm"
  create_vm = true
  create_vmss = false
  ...
}