Chesapeake & Potomac Telephone Co. asked Virginia authorities yesterday to permit a $23.5 million annual increase in residential and business rates.

In a petition filed with the State Corporation Commission, C&P proposed a 5.92 percent surcharge on most intrastate services to bring in the additional revenues.

For consumers with flat rate residence lines, the C&P increase would add from 34 cents to 64 cents a month to existing monthly bills. Business with single-rate prices would have montly increases ranging from 73 cents to $1.75 a month.

In addition, for customers charged by the number of calls made, message units would increase in cost from 8 cents to 8 1/2 cents a piece after the 50-call monthly allowance.

Lee Tait, vice president of C&P of Virginia, said yesterday that company data shows that it needs more than $40 million of new annual revenues to earn an authorized 9.2 percent rate of profit on its investment in the state.

The SCC accounting staff's audit for the C&P figures found the shortfall to be $23.5 million but Tait argued that the agency did not consider wage increases that took effect in August.

Tait urged the agency to approve the surcharge effective March 1, subject to refund if found later to be excessive. In addition, he called on the SCC to hold a hearing as soon as possible on the telphone company's conclusion that it needs a larger rate boost.

C&Phs last major rate increase in Virginia was a $40.5 million annual boost in 1977 and Tait said the proposed rates are in compliance with President Carter's restraints on price hikes. C&P is owned by American Telephone & Telegraph Co., which unlike electric and natural gas utility firms has pledged to keep rate increases within the administration's wage and price guidelines.