In Android, there used to be a permission with the name BRICK that could be used to potentially disable the device. Other than hearing it as an urban myth, I do not really know if this permission can really be used to brick a device.

All I can think of are the following reasons:

To build a LoJack kind of an application that can remote disable a phone should it discover that the phone was stolen.

For enterprises to be able to remote-wipe a phone should the phone get lost somewhere.

Is there any other sane reason why a third-party app would require to use it? And why was it removed (not sure) from GingerBread?

Also, what does it really do anyways? Reset the phone to its factory settings?