Why is Junction Temperature called so?
For a given current flowing through any device, maximum dissipation and so highest temperature occurs where there's maximum voltage drop.

The word 'junction' doesn't have to only apply to BJT P-N junctions, it also describes well the region between source area and the drain area in a FET, which is where the bulk of the inter-terminal voltage drop occurs. You could call it the gate channel if you like, but most people are quite happy calling it a junction.

The point at issue is that it's the very small volume of the die where all the action happens. It's not the heatsink temperature, it not even the average die temperature. Because it's so small, it has little thermal capacity, and so dominates the single short pulse power handling specifications.