The British East India company had set up "Presidencies", which began as trading settlements and expanded to become a local government system. The East India company came under increasing regulation by the UK government and by the middle of the 19th century it controlled, on behalf of the UK government, most of South Asia. Each Presidency was independent of other presidencies, but under oversight of the company, which was regulated by the British.
It had the large "Presidencies" (such as Bengal) and smaller "provinces" (like Nagpur). After the Bengal rebellion in 1857, the UK government took direct control of much of India. This is what is called the "Raj". The system of Presidencies and Provinces was adopted, and a Governor appointed to each.
There were other districts that were later incorporated into the Raj. In some cases, this was done in an ad-hoc manner that left some doubt about what the actual system of government was. To rectify this the "Scheduled districts" act, made a list of these districts and described processes for their administration. These small districts didn't have their own Governor, but a chief commissioner who would report to the Governor of a neighbouring province or presidency.
They were called "scheduled districts" because they were listed in a schedule (an appendix) of the act.
These were relatively small regions of British India. They had some independence from neighbouring provinces but were still under the ultimate control of the British.
The purpose was effective local control of India, which allowed for local matters to be dealt with at local level while allowing for British hegemony.