The optical studies reveal that binary mixtures of nematic and cholesteric compounds viz., 4[2-2-ethoxy-ethoxy carbonyloxy-cinnamate of 4-hydroxy) 4’-methoxy azobenrol (ACZHM) and cholesteryl ethyl carbonate (CEC) exhibit cholesteric, smectic and cholesteric phases in the concentration range of the mixture 1 to 9% of CEC, 10 to 40% of CEC and 41 to 99% of CEC respectively. The mixtures with low percentage of CEC exhibit reentrant smectic A - smectic C - smectic A phases. With the help of the phase diagram of binary mixture, the phase behaviour is discussed. The order parameter of the nematic compound ACZHM is estimated. optical anisotropy of the mixtures also estimated using density and refractive index data. Numerous optical textures like striped pattern, focal conic, fan shaped and drops are illustrated. Pitch variation with concentration is discussed.