That is a splash guard to keep oil away from the elbow which acts as a breather. Don't plug this hole. The opening in the elbow should be down. As things warm up and the oil and air inside expand this breather allows air to escape and keeps oil from leaking past the seals. Every gearbox on those tractors is vented. The transmission and rearend vents through the gear shift tower. The rubber boot covers a groove on the front of the casting. Both final drives have small vent holes below the input shafts that vents into the cast tube.
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