University of Maryland associate physics professor Edgar F. Beall yesterday told a faculty review panel conducting termination hearings against him that another professor "exaggerated," when he claimed that Beall grabbed him by the neck as if to strangle him during an argument a year ago.

Beall 44, testified for two hours before the five-member review panel during the final day of his termination hearing. The university's administrators are trying to fire Beall, a tenured professor and political activist, on grounds of willful neglect of duty, misconduct and incompetence.

The Beall case has attracted wide-spread campus attention during the past year. Many faculty members have argued that the case aganist Beall, an activist in leftist political circles, involves the issues of academic freedom and due process.

On Thursday, physics professor David S. Falk testified that Beall "lunged at me and grabbed me by the neck," during an incident in the physics building on May 20, 1977.

Beall was supended from teaching three days later and on June 3 was told by the head of the physics department, Alex J. Dragt, that he could not return to teaching until a psychiatrist certified him as "able to meet your university responsibilities."

Beall said yesterday that while he was angry at Falk, he never grabbed him around the neck. "I was upset and no doubt I was shouting," he said. "I distinctly recall that I grabbed hold of his lapel with my right hand. He said he was going to call the police and I begged him not to.

"He said he would call if I touched him again. I guess I interpreted that as a dare . . . (so) I touched him on the shoulder and it was not very hard, but there was contact."

Later, under questioning from his attorney David Gestass, Beall said he had decided to refuse a psychiatric examination after consulting with colleagues.

"I felt if I acquiesced it would give credence to the idea that I was insane," he said. "I didn't believe I was crazy and I didn't believe I had to prove it."

The testimony marked the frist time that Beall has commented publicly about the incident with Falk.

The board is scheduled to submit its nonbinding recommendation to the university board of regents no later than June 30.