There is a fallacy, but it is not being used by one of them against the others.
There an overall appeal to authority here that both have bought into. They just disagree upon whether that authority should be the Bible, or all 'inspired literature' about God that passes some other test. (There has to be some test, or you quickly get to a much better argument: the Ramayana and passages about spaceships. What is the point of a spaceship without aliens? Who would Rama go visit?)
Either that, or this is taking place within a context where a premise of fundamentalist literalism is accepted as an open premise. That would be a rare context these days, but still easy to find.
This argument by 'Y' is not unheard-of on a larger scale. There are definitely traditionalist Mormons who take a fundamentalist literal view of the world. But given their origin story, they then have to accept the notion there are probably undiscovered scriptures in addition to both the Bible and its Mormon extensions. So there might then be more...