fatal: Path 'XXX' is in submodule 'YYY' when git add

$ git ls-tree HEAD YYY 

 160000 commit c0f065504bb0e8cfa2b107e975bb9dc5a34b0398  mysubmodule 

That doesn't depend on the presence of the .gitmodule file, or on the content of mysubmodule.

You need to remove that entry from the index first:

$ git rm --cached YYY