Maryland asked the federal appeals court here recently to halt all sludge dumping at a controversial ocean site 35 miles east of Maryland's and Delaware's beaches.

Appealing a lower-court decision by U.S. Deistrict Judge Gerhard A. Gesell, Maryland Deputy Attorney General Warren K. Rich said "the facts cry out" for a decision halting dumping.

Under a permit that expires in June but could be extended. Philadelphia dumps 50,000 tons of sludge monthly at the so-called Cape May site. Maryland claims bacteria, viruses and heavy metals in the sludge are a potential danger to people who use the water and to the shellfish industry.

Donald S. Russell, one of the three judges hearing the case in the Court of Appeals for the Fourth Circuit, said he was puzzled by Maryland's appeal. "This seems to be an argument over very little," he said.

Russell noted that Gesell's decision specifically upheld sludge dumping by Camden, N.J., but that since that verdict last May, the city no longer uses the Cape May site, but another one more than 100 miles off the coast.

The judge asked Rich why Maryland, if it wanted to stop Philadelphia from using the site, couldn't argue against renewal of the city's permit at the public hearing that will begin probably in April.

However, Rich said the issue was not just Philadelphia's permit, but what he called "the improper designation" of the site by the Environmental Protection Agency. He said EPA designated the site with no environmental impact statement.

Maryland officials feel that Gesell, in the lower court decision, did not adequately consider this more general issue. They are hoping it will get more attention in the appellate court.

Representing EPA, Robert L. Clarquist, an attorney with the Justice Department's land and natural resources section, told the court, "We don't understand why Maryland made this appeal at all . . there's nothing left."

Clarquist also said that while Philadelphia is dumping 10 times as much sludge as Camden used to dump at the Cape May site, Philadelphia's waste has "much less bacterial and virus content."

Rich, though, argued that "it's a horrible situation" because the greater volume of Philadelphia's sludge offsets the fact that it is less contaminated that Camden's.

EPA officials said they hope to phase out by 1980 "all dumping of sludge that doesn't comply with stringent standards." Toward that end, Philadelphia has been ordered to cut its dumping in half by 1979 and end all of it by the next year.

But Maryland officials, saying they are concerned about hazards from interim dumping at the Cape May site, want that location closed immediately - thus their decision to take EPA to the Court of Appeals.