Upscatter is generally a small, but non-zero effect. It isn't usually discussed when being introduced to the multi-group model because it makes the equations look more complicated. I included it because I like the resulting symmetry it produces in the equations. To me it makes it obvious that the coefficients mean things are scattering out of the neutron energy range of that group.
The easiest way to explain up scatter is with the billiard ball model of neutrons. Think of the speed of atoms in thermal equilibrium. There a distribution of energies, some have above average speed, some have below average speed. If this is at equilibrium then there must be some phenomena that prevents them from all having the same energy. Now think of the geometry of the collisions.
If you have two neutrons separated with velocity vectors 90 degrees apart, with equal energy and on a collision course. If they hit each other with perfect timing and geometry they will both scatter and end up with the same energy. Now if instead, one neutron then hits the side or back of the other neutron it can transfer it's energy and momentum to the first. This results in one neutron with higher energy and one with lower.
While I described it with neutrons, the same process can take place with anything that undergoes collisions. Neutron-nucleus for example also works. You can end up with fast moving atomic nuclei in different ways, fission fragments for example can have significant energy for short periods of time. The total effect from up-scatter is usually small but it is still included especially when you have very narrow energy groups.