I am going to presuppose that like nearly everything Chevrolet pressed the torque-tube into the carrier casting and secured it with rivets. Chevrolet just loved to press things on. It has been my experience owning a 1954 Belair for most of my life, and now a 54 3100, that some seepage is normal. There was not a high concern back in the day like it is today in get things sealed up well. Judging by the photo this is seeping more than it should.

I would first check the breather mounted on the top of the axel housing on the left side to see if it not clogged. You should be able to turn the top of the breather freely: it should practically rattle when flicked with a finger. The breather allows expanding air to escape when the differential warms up while the truck is being driven. If it is not moving freely it is likely clogged, and it might be a case that the warming expanding air inside the differential is forcing grease out the weakly sealed points of the differential such as the torque-tube. If the breather is not clogged you will need to determine a way to seal the torque-tube. I am hesitant to advise on how to do as I haven't had this situation on my own vehicles.

Walt Williams
La Verkin, UT

Last edited by 54Belair; 07/24/2015 12:17 AM.