Can EPiServer CMS be hosted in Azure platform? Is there any specific license type for the same?
Not at the moment, but according to EPiServer's road map support for this will come. In the mean time EPiServer has a cloud based alternative: EPiServer Cloud.
What are the restictions?
The license is restricted to ip/mac address. But if you setup a dedicated virtual server in Azure with IP address that doesn't change you'll be good. What you typically want though is a license model where you pay for usage (eg. where you can take servers up and down based on required resources or similar).