Let's get a little deeper:
This is the Authentication step before the association. In message 1, the client starts the authentication by sending cryptographic material based on the passphrase.
The AP sends back its cryptographic material, which is also based on the passphrase. At this step, the AP needs to know the passphrase. For iPSK with RADIUS, the AP could have queried the RADIUS server after the client's message, as the client MAC is known after this first packet.
But without RADIUS, the AP only has a list of possible passphrases and must choose one. The AP doesn't know which, so this will never work.
The following is what is done with WPA2 and iPSK without RADIUS. Basically the AP does a dictionary attack on the PSK based on a small list of possible passphrases:
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