Modula-2 was at best obscure at the time, while Pascal was popular. Kernighan got involved with Pascal in order to write the Pascal version of "Software Tools", called Software Tools in Pascal. He wrote "Why Pascal is not my favorite PL" as a result of that book effort. I believe that is explained in the article.
If there had been enough demand to also do a Modula version of the book, he might have written a more favorable article about Modula afterwards.