The Supreme Court yesterday let stand a ruling that the privilege protecting the secrecy of a priest's talks with a penitent didn't bar a grand jury from inquiring into the clergyman's conversations with third parties.

The Rev. Louis R. Gigante, 46, now faces a 10-day jail sentence for contempt. The New York City priest argued that the clergyman-penitent privilege shielded his refusal to answer the jury's questions about his efforts to persuade correctional officials to ease the lot of an incarcerated reputed organized-crime figure.

The court let stand a 5-to-0 ruling by New York's highest tribunal.

After being ordained, Gigante visited prisons, ministered to prisoners, took an interest in prison reform, and was a city councilman from 1974 to 1977.

In 1977, he was subpoenaed to appear before a state grand jury investigating alleged preferential treatment given to incarcerated organized-crime figures by the city Department of Corrections. One of them was James V. Napoli Sr., an old and close friend of the priest who had received a Christmas furlough in 1974 and admission to a work-release program.

Gigante refused to answer questions about whether he had talked with Napoli about his jail conditions, successfully invoking the priest-penitent privilege.

Later, the grand jury asked the priest about a conversation he had with a department official, allegedly as a result of the earlier talk with Napoli. Gigante replied: "I really refuse to answer basically, not only as a priest, but because the questions attempt to infringe upon my practicing my ministry, which is protected by the First Amendment to the Constitution."

Two days later, he refused to answer additional inquiries. One was, "Do you recall saying in substance to Mr. Ford [a corrections official], 'And if I prove that people have gotten out who are heavy gamblers, who are organized crime, what happens then, make a big stink about it? I know a lot of things that have happened that I will not divulge at this time, a lot of things that is bad for the correction department. I would only use that as a means of helping James Napoli.'"

Another question was: "Father, did you on behalf of your brother, Ralph Gigante, contact [another corrections official] in an effort to get your brother transferred from Rikers Island to a less strict situation in the Department of Corrections?"

The judge acknowledged that nothing in the grand jury minutes intimated that the priest had engaged in any criminal activity. But the jury might reasonably wish to inquire into "the apparent use in part" of Gigante's "position as a public official on behalf of a prisoner," the judge found.

In an appearance six weeks later, the priest again invoked the Constitution to refuse to answer the inquiries. After that, he was held in criminal contempt and given 10 days in jail. The sentence was stayed pending appeal.

Last May, the New York Court of Appeals unanimously upheld the conviction. Judge Matthew Jasen wrote for the court that it was "all too apparent" that the questions the priest refused to answer did not jeopardize uninhibited communication within the priest-penitent privilege.

Rather, Jasen said, the questions involved Gigante's contacts with department officials-- "strangers to the confidential relationship." The revelation of such conversations "cannot be said to fall within the sanctuary of the priest-penitent privilege," the judge said. He added:

"On the record before us, [Gigante] raises no colorable First Amendment right. His right to practice his ministry cannot serve to shield him from shedding light upon whether or not any unlawful efforts were undertaken to assist those confined in New York City penal institutions to obtain special privileges . . . "

The Roman Catholic Archdoicese of New York urged the Supreme Court to settle the question as to "the limitations if any, on a grand jury's right to elicit the testimony of a clergyman as to actions taken in the practice of his ministry," no matter the religious faith involved.

Its friend-of-the-court brief emphasized that Gigante was not asserting "a blanket privilege against testifying at all," or "a general right" of a clergyman "to resist all questions until the government satisfies certain conditions."

Rather, the archdiocese said, the question is whether "a balancing test" should have been applied to determine whether the need for his testimony "is so compelling that it outweighs his First Amendment right."