Former South African information secretary Eschel Rhoodie today pleaded not guilty to seven counts of fraud or theft in connection with his activities as head of a covert multimillion-dollar propaganda effort.

The opening testimony and defense arguments indicated that the case could implicate higher ranking officials. The propaganda effort, which became South Africa's worst political scandal when revealed last year, already has disgraced a state president, a powerful minister and Rhoodie himself.

In an apparent attempt to deflect responsibility from his client, Rhoodie's lawyer, Johan Kriegler, today alleged that instructions to destroy certain documents dealing with the secret propaganda effort originally came from John Vorster, who was then prime minister. Kriegler did not substantiate the allegation at today's session.

Vorster, who later became state president, and Cornelius Mulder, who held the post of information minister, were forced to resign as a result of the scandal.

While the public in general shows only scant interest in the trial, aficionados of what has become known as South Africa's "Muldergate" scandal are watching the proceedings closely to see what new details about the propaganda campaign might be revealed. There is also a possibility that well-known figures including Prime Minister Pieter W. Botha may be called as witnesses in defense of Rhoodie.

The trial, presided over by Supreme Court Judge Charl Theron, is the culmination of a protracted effort by the government to locate and then extradite Rhoodie from his self-exile in France. He was brought back to South Africa under police guard Aug. 23.

Rhoodie, 45, is charged with misappropriating about $100,000 of the estimated $24 million in government funds he is said to have controlled in accounts overseas for the Information Department.

The secret projects, aimed at winning public opinion over to South Africa and its apartheid racial policy, were financed by a fund totaling more than $72 million, according to government investigations.

Kriegler said all the sums that the state alleges were stolen by Rhoodie were actually reimbursements to himself for payments he had made to "anonymous collaborators" in these secret projects. Due to the "unconventional" nature of the propaganda effort, he said, no receipts were kept of these payments.

One of the "anonymous collaborators" to whom Rhoodie says he gave money was a prominent Jewish architect in Pretoria who has since died. The Information Department's senior accountant, Abraham Fourie, today said that the department often used such persons to entertain important visitors from Israel to influence them more sympathetically toward South Africa.

In previous testimony Fourie mentioned that there had been a Jewish plan code-named "Project David." Kriegler said Rhoodie would testify that the Jewish architect had been involved in recruiting support in the Jewish community for the one of Rhoodie's biggest projects -- the covert governmental financing of the pro-apartheid English-language newspaper The Citizen.