I am guessing these words are from your Retention Statement!
Unencumbered balance in client ledger (after reversing value of unsettled bills if any in case of trade day billing and margin amount if debited in client ledger) -
This is nothing but the opening ledger balance in your trading account as on the date mentioned in your statement. Retained here means that the funds remain in your trading account and not transferred back to your bank account as per regulations (SEBI mandates every broker to transfer client funds back to the clients bank accounts atleast once in 90 days).
But there are few situations under which a broker need not settle the funds but may retain the balance in the client’s trading account. So this statement just explains if your trading account balance will remain in your trading account or transferred back to your bank account. Do check this answer to know more.