The dean of the House, Rep. George H. Mahon (D-Tex.), chairman of the House Appropriations Committee termed "outrageous" the manner in which a pension bill for members of Congress was passed last month.

As the result of adverse publicity about the measure, Mahon predicted yesterday the bill, now before the Senate would die, saying "I suspect the bill has been buried."

The measure was approved by the House Sept. 23, without hearings, advance notice or debate. It would raise retirement pay of legislators with 20 years of service by $3,000 a year if they resigned before Jan. 3, 1979. The bill would let them use their final year's salary - the newly raised $57,5000 - as base for retirement pay computation rather the average of their salaries over the last three years.

Mahon, who has served 42 years in the House, has already announced his retirement but carefully noted yesterday the proposed measure would not affect his pay.

Under the present law, legislators with 32 years or more of service are permitted automatically to take retirement at 80 per cent of their highest pay level.

Rep. James A. Burke (D-Mass.) took the House floor yesterday, to denounce as inaccurate a line in a Washington Post story about the pension bill that said he was among those who had announced they were retiring.

The 67-year-old Burke noted his grandfathers and grandmothers all had lived to be over 90 and then declared, "I have not announced my retirement. I intend to wear out; I am not going to rust out like some would have me do. They are not going to put me out to pasture as long as I keep the fighting spirit I have."

His colleagues have him a standing ovation.

Prior to Burke's statement yesterday, there had been stories circulating among Democratic members that Burke, a 20-year House veteran, was going to retire before next year's election because of ill health. He recently had a leg amputated and now moves around Capitol Hill in a motorized wheelchair.