South Korea's principal opposition leader, Kim Dae Jung, categorically denied at his court-martial today that he had attempted to encourage massive student demonstrations here last spring.

He also denied having passed funds to a student leader who allegedly used the money to foster the May demonstrations in the provincial capital of Kwangju.

"I have never urged, directly or indirectly a single student to stage demonstrations since the assassination (of president Park Chung Hee in October) and not a single man has received any funds from me to organize demonstrations," he said.

Kim was testifying under examination by his court-appointed defense attorney in the seventh day of a trial in which he and 23 other defendants are accused of instigating a rebellion. He could face a death sentence if found guilty by the military tribunal.

As in earlier sessions, part of today's testimony was censored by military authorities. Significant parts of it were later confirmed by diplomatic observers.

Kim earlier denied selected charges in the martial law command's case, but his denials today were more sweeping and categorical.

A principal government charge is that Kim encouraged students to demonstrate in early May, hoping to create a climate of confusion and chaos that would topple the government of then-president Choi Kyu Hah. Kim hoped to seize power illegally in the chaos, the military alleges.

It has also accused him of giving a large sum of money to Chung Dong Nyong, with a suggestion that he foment demonstrations in Kwangju. Kim had been interned by military authorities, preceded a violent citizens' rebellion that eventually was suppressed by troops.

Instead of encouraging demonstrations, Kim said he had sought to disuade students from moving into the streets because he believed that clashes with martial law troops would not be good for either the students or the country as a whole.

Kim testified that he had offered to cooperate with the Choi's administration so long as it promised a "democratic development."

Kim acknowledged today that he had signed a statement admitting having money paid to the student leader, Chung. But he said that was part of a statement he made under duress and the threat of torture during his detention, according to diplomatic observers present at the trial.

Kim said he was told by his prison interrogators that he would be able to deny the confession in court.