Do rest servers need to be hosted on a website or CMS?
The beauty of REST is precisely that it doesn't matter where your API is, as long as its accessible from your Drupal server, or from the client if you have a javascript API client.
If it's a simple application and you have admin access to your Drupal server, there's nothing preventing you from hosting the Python webservice side-by-side. They may even share the same HTTP Server, like Apache or Nginx, although depending on your demands on each one it might be better to keep them separate.
If you're new to Python, the Flask framework is a decent option to write a simple REST-like API interfacing with a Python module.
I need to create a REST server of a python module/API of a BCI, so that the application can be accessed on my Drupal website. Will I need to create and host the REST server on a python-based website or CMS, so that it can be accessed by my Drupal website, or is the api and rest server uploaded and hosted directly on my web hosting server? If so, what is the simplest python CMS that for creating a REST server for a python module/API already available?