Federal Trade Commission Chairman James C. Miller III has urged Congress to give the "embattled" agency a legislative endorsement spelling out its policies and goals.

"We advocate that you move expeditiously on legislation that reaffirms Congress' support for the agency's historic mission," Miller said Tuesday, opening two days of hearings by the House subcommittee on commerce, transportation and tourism.

Although Congress continues to appropriate enough money to keep the FTC in business, it has not defined the agency's mandate and mission through an official authorization since 1980. Its last authorization expired in 1982 amid a pitched lobbying battle among representatives of business, public interest groups and government.

Through the authorization process, Congress can clarify, limit or expand the agency's jurisdiction over some groups and issues. It also can define more explicitly the agency's standards for challenging "unfair" or "deceptive" business practices and direct the agency's efforts in new directions.

Consumers and businesses, therefore, have a lot to gain or lose through the reauthorization process. Attempts by the last Congress to reauthorize the agency collapsed under the dual pressures of professional groups seeking exemption from FTC regulation, and a debate over Congress' right to veto FTC actions.

The agency continues to function without authorization. But the process is important to dispel public uncertainty about the agency's powers and policies, Miller said.

"Congressional reauthorization will mean that businesses regulated by the FTC, consumers protected by the FTC, and the taxpayers we all serve will know the commission's underlying authority have been examined and approved by elected officials," Miller said.

Representatives of grocers, retailers, lawyers, doctors, plumbers and advertisers testified at the hearings, generally falling into two camps -- those who feel the FTC is too easy on business, and those who wish it were easier.

"There are people here who say reauthorization is hardly worth the effort," said subcommittee Chairman James J. Florio (D-N.J.), referring to groups that believe the FTC has been lax about enforcement under a pro-business, Reagan-appointed majority.

"There is a perception of inactivity in key areas," Florio said, noting a request by the National Association of Attorneys General that they be granted power to enforce parts of the Federal Trade Commission Act.

Miller said the agency now gets more done with fewer personnel than under previous administrations. He argued against the state attorneys' request, saying their complaints about FTC policies often reflect "ignorance, not expertise."

Miller said he expects to win authorization, but some observers worry that the current crop of complaints may prevent authorization again this year.

Florio said FTC authorization is "more probable" this year than last year, but that the chances depend on the willingness of certain groups to "scale down" their requests for "radical changes" in the agency's mandate.

Complaints about the FTC were submitted to the subcommittee by independent grocers, retailers, an alliance of plumbing, heating and cooling contractors, advertisers, the American Bar Association and the American Medical Association.