It happens when you have Entity Translation enabled in parallel.
The "Content Translation: Language" filter is missing from Views if you have enabled both Content Translation (module
translation, in Drupal 7 Core) and Entity Translation (module
entity_translation, a contrib project). There is also a this Views issue dealing with this situation, and there also the environment had both translation systems enabled.
This is normally not meaningful as these two systems are meant as alternatives to each other, with Entity Translation being the more modern one. However, in some special cases it can be meaningful (like, handling some legacy node types with Content Translation, new node types with Entity Translation).
Use Select Translation. This module is specifically made for Content Translation and provides a Views filter "Content Translation: Select translation" that provides the same possibilities as the missing "Content Translation: Language" one, plus more freedoms to configure fallback behaviour.
Disable Entity Translation. This alternative should give you the "Content Translation: Language" filter with its fallback behaviour. Perhaps disabling is not enough though and you'll have to uninstall the
entity_translation module as well (see here for a similar but reverse situation).
Use "Content: Language" (usually not applicable). When Entity Translation is enabled, on its own or additionally, it provides a Views filter "Content: Language" (as also found by the OP). It provides the same configuration options as "Content Translation: Language" and can also filter nodes for which you use Content Translation. However, it does not know about the "translation set" concept of Content Translation, so the Views result can contain multiple translations of the same content (unlike when using it with Entity Translation nodes). For that reason, it is only a solution if you allow only one value to pass the filter, like by setting it to "Content: Language (= Current user's language)". Also unlike the "Content Translation: Language" filter, this filter does not provide a fallback to the site's default language.