Did BSc, doing MSc, applying for PhD. Is it frowned upon to not have a letter from my BSc advisor?
Will you get a recommendation letter from your current (MSc) supervisor? I would assume that would be the most relevant and important one. References from your last position will likely be the most relevant for the next one, as those are the people that have worked with you most recently. 

It might be a bit curious that you omit a recommendation letter from the only completed work you have by the time of application, however if the references you attach to your application are more relevant in terms of timing and topic I think it wouldn't hurt your chances.