Assertion: Species are groups of potentially interbreeding natural populations which are isolated from other such groups.
Reason: Distinctive morphological characters are displayed due to reproductive isolation.

Both Assertion (A) and reason (R) are correct  but R is not the correct explanation of A.

A group of individuals resembling each other in morphological, physiological, biochemical and behavioural characters constitute a species. Such individuals can breed among themselves but cannot breed with members other than their own to produce fertile offsprings. New species are formed mainly due to reproductive isolation.