Montgomery County Executive Charles W. Gilchrist took the stand yesterday in Montgomery County Circuit Court in his own defense, in a civil suit brought against him by the police chief he fired less than one week after taking office in 1978.

At issue is whether Gilchrist fired then police chief Robert J. diGrazia because of policy differences or as an act of punishment, as alleged by diGrazia.

Gilchrist described how he viewed the actions and speeches of diGrazia, an outspoken and controversial chief appointed by Gilchrist's predecessor. DiGrazia and his policies became an issue during the 1978 election campaign and were repeatedly criticized by Gilchrist.

DiGrazia alleged that he was fired improperly, and that he is therefore entitled to a discipline hearing before the county's Law Enforcement Trial Board. His arguments were rejected by a Montgomery County judge in 1979, but the Maryland Court of Appeals ruled in his favor in 1980, and sent it back to circuit court, where it now is being reheard. Yesterday is the first of what is expected to be a three-day trial.

DiGrazia is not seeking monetary damages in the current circuit court suit, but his attorney, Peter Davis, said yesterday that if diGrazia is successful in this week's hearing, it will allow him to reactivate a $6.5 million federal suit against Gilchrist, filed in U.S. District Court in Baltimore two years ago, alleging that his right of free speech was violated.

Three statements made by diGrazia in 1977 and 1978 became the focus of much of the controversy surrounding him during the election campaign. DiGrazia had said that 50 percent of police officers were unsuited for their line of work, that officers were "social workers who carry guns," and that "police consider the community their enemy."

DiGrazia does not deny making these statements, but contends that they reflected general police administration philosophy and did not refer to the Montgomery County Police Department in particular. According to Davis, diGrazia made the first statement in an introduction to a 1977 book on police, written by a psychologist, and it was widely quoted afterwards.

DiGrazia and his attorney argued that Gilchrist fired the chief specifically because of these statements, making the firing a disciplinary action--and one that violated a free speech provision in the state's Police Officer's Bill of Rights.

"My own feelings were negative towards that kind of statement," Gilchrist testified yesterday. He said the statements were "disparaging, or thought to be disparaging, about the qualification of officers." He said he felt that the statements by diGrazia were "inappropriate, and destructive" to police morale.

But Gilchrist said he probably would have fired the police chief even if the statements had not been made. He said there were "serious problems" with a police training project and with civilians holding too many important positions within the department. Gilchrist said, "he was not the sort of chief of police I had confidence in."

Witnesses are expected to include several former leaders of county police organizations and Circuit Judge James McAuliffe, who was a chairman of Gilchrist's 1978 campaign, before McAuliffe was appointed to the bench.