WITH STUNNING ambivalence and a dan gerous disregard for one of most important accomplishments of the D.C. Council this year, Mayor Barry has announced his refusal to sign the no-fault auto insurance protection bill that would provide improved coverage and compensation for victims of accidents. Quite aside from his flimsy reasons for looking the other way, the effect of Mr. Barry's waffling is to jeopardize the local legislative process--inviting congressional interference and the possible death of a sound proposal.

Under the home-rule charter procedures, the bill goes to Congress for review. Does Mayor Barry believe for a minute that lobbyists for the lawyers who thrive on the current costly litigation system won't be all over Capitol Hill trying to kill the local bill? If that doesn't bother Mr. Barry as a matter of home- rule principle, he must not care about the bill itself. Or will he defend it against congressional attack?

In his vague explanation last week, Mr. Barry said he was "concerned that the necessary protections for the consumer be included and, when necessary, clarified." The clarification could begin right there--since he neither specified any objections nor gave the slightest clue as to what he was talking about.

If this is meant as a way to keep those cards and letters coming with campaign contributions from a well-organized group of plaintiff attorneys, it may work. But it won't work if it's a bid for support from consumer groups that have supported no-fault for years--along with organizations of the elderly, business, labor and individuals who are sick of lawsuits, fees and delays under the current insurance system.

Mr. Barry's inability to take a forceful stand on behalf of motorists, accident victims and everybody who lives in fear of the uninsured motorists on this city's streets is bad enough. But tossing this sound bill hot-potato-style to Congress without his signature is as reckless as it is irresponsible.