Understanding MTB Pedals
That's for mounting straps on the pedal. Here's a picture of a pedal with the straps on it: 



Which side of the pedal should you use? On some pedals, one side has an axis that protrudes a bit, and the other side is flat; the latter is the one you should use. However, if both sides of the pedal are flat, feel free to use either side of the pedal.