Only a guess but this would likely have been because St. Patrick’s Day is a “holy day”. People attend church (lots still do although in the last couple of decades it’s declined massively) and closing pubs would be in line with how some other “holy days” are treated. An example of this is Easter in Northern Ireland. There are still some relatively strict licensing laws over the Easter weekend (although these are about to modernise) with pubs shit for large parts of it.
So it's possible that this was passed down the generations as fact. It's not true any more though.