The transmission is a contrivance that uses gear and gear trains to offer necessary speed and torque conversations. And the transmission fluid is a high-standard oil that keeps the transmission cool and lubricated. So, burnt transmission fluid is an indication that- transmission has overheated. The absence of enough transmission fluid in the reservoir can cause burning up and transmission overheating. You should feel lucky since all cars have the potency to indicate when the transmission has gone to fail. Replace the transmission fluid as soon as possible to get rid of the burning odor in the car.