This line is from Chapter 9 of A Separate Peace in which Phineas organizes the Winter Carnival, a time of youthful exuberance in which the boys feel a liberation from the "gray encroachments of 1943." While they celebrate their afternoon of "momentary, illusory, special and separate peace," Finny receives a telegram from Leper Lepellier that informs him that Leper has "escaped and needs help." He informs Finney that he is at "Christmas Location." These last two words are in code for Finny and the others; they mean his home in Vermont.
The term itself is ironic as home and the location for Christmas is ordinarily a joyous place, not one where a man hides furtively. It is also ironic that Leper should steal the innocent jubliance of the Winter Carnival away from Finny in writing to Gene that he has "escaped," or gone AWOL from the service.