The Mortar Pit's primary purpose is to provide cover for units, and provide mortar units with its rate of fire bonus. Grenades cause more damage to men inside mortar pit, just like in trench. It is used in many strategies because you can place more men inside it without them being on top of each other. M3 AT Guns were often placed to Mortar Pit as AT stack. Though, now that strategy is obsolete, as AT guns will not fire if in close proximity to another.
Mortar pits are often used instead of trenches due to their size and more ideal shape.
Note: Mortar pits are currently bugged, and will not provide a fire rate bonus to mortars.