As you can see on the image below (i am on a mobile device) the upload icon has a down arrow.
Shouldn't the icon have an up arrow instead meaning that the file is going up instead of down?
Yes - the icon should be an arrow going up.
With a term like upload, of course the arrow should be pointing up. Searching for upload icons on Google Images, there are no down arrows (corresponding to the upload action) to be found.
The folder aspect of the icon is fine - it's just the direction of the arrow which is wrong. There's no good reason in this case to buck the trends and use the down arrow, especially as its confusing nature has sent you here to ask the question!
In actual fact, if you do go and upload something, the subsequent page has - (guess what?) - an up arrow, so they are not even consistent in their own software, let alone with every other piece of software.
For both upload and download you upload/download from and upload/download to something. So the direction of the arrow simple depend on which you are considering and whether you think of the arrow as coming from the icon or pointing to the icon.
In cPanel's case, they are thinking of it as upload/download from, and consider the arrow to be coming from the icon.
So for cPanel, they seem to think of this as:
Upload from your local folder (hence the folder icon)
I can't tell you whether their view is better usability wise than thinking of it the other way around, but I would hope that they have done some testing with their customers on this. However, even if it is poor usability wise, people have gotten used to it, so changing the icons now for something else (even if better), would cause confusion for their existing customers.
The icon, taken literally, shows an open card folder and an arrow pointing into it. Read directly, it seems a good choice for an upload icon, because when you upload, you're putting files into the server's folder.
However, because the term itself refers to a direction, and because convention uses up arrows for uploads / uploading elsewhere, the icon actually ends up confusing. What's more, because users are familiar with yellow folders meaning local machine folders (thanks to the conventions of Microsoft Windows), users could easily misread it signifying a *down*load to their own machine.
Another example of how convention and context can trump 'local' and 'innate' clarity.