My assumption would be that it is due to the fact that a Normal type move was used on a Ghost type Pokemon (No Effect!).
Outside of cases like Scrappy, Foresight, or Odor Sleuth, Normal type attacks are completely negated when used on Ghost type Pokemon. Slash is a Normal type move, so it was negated automatically. Because the attack was negated, Pangoro never actually made contact with your Aegislash, making it impossible for King's Shield to lower Pangoro's Attack.