Both are incorrect, but if you inserted the word "the", the first one would be correct, while the second would still be wrong:

(1) Why is **the** past tense not used? (correct)

(2) <strike>Why is not **the** past tense used?</strike> (not correct)

"Not" modifies "used" rather than "the past tense": "Is the past tense used?" "No, the past tense is **not** used." Adding "Why" to the beginning of a sentence pulls the auxiliary verb into second position, but leaves "not" and the other words where they were.