Rejoyce, what do you mean when you say you drag "it" over to the form. What are you dragging? The way you wrote this, it seems as if you're dragging the Contact Selector control itself over to the form canvas, but if you're doing this, then I don't understand why you would expect to get prompted with anything. Doing that would just drop an unbound Contact Selector on the form.
If you meant that you are dragging your Contact Selector GROUP from the main data source to the form canvas and aren't seeing the Contact Selector option, then my guess is that you're dragging the wrong thing. If you have configured the Contact Selector custom control to work in your form, then you should see it as an available option when you drag the gpContactSelector group over (or whatever you named it). Don't drag the repeating Person group, but rather the non-repeating group above Person.