Only Bots whose Tier is lower than the target Bot can be Forged. For example, a 4-Star Bot accepts 1-Star, 2-Star, or 3-Star Bots, but a 2-Star Bot only accepts 1-Star Bots. The same applies to Modules.
Bots that are the same Tier cannot be Forged. You cannot consume a 4-Star Bot in order to power-up another 4-Star Bot. The same applies to Modules.
The Forge feature should become available once your roster of Bots or Mods is large enough. You must own a minimum of 13 Bots or 8 Modules before Forging becomes available, and those Bots must be across more than one Tier.