I assume that limit is there because giving players even more income would quickly result in integer overflows if they were to deploy all those armies for a number of turns.
I remember there was someone hosting 1v1s with gigantic reinforcement cards (which ppl would obviously play to smash their opponent), however, once played the game would crash for them and they would get booted. Upper limit seems like an easy solution
I recall someone once having a game where the amount of armies on a territory was so large the game got a warzone error. Must have been over 5 years ago.