In an aging, dilapidated building in this heavily Arab city, the Israeli Army is being accused of mounting a campaign of systematic harassment, indiscriminate punishment and occasional brutality against the Palestinian Arabs of the occupied West Bank.

The drama surrounding these accusations is unfolding in a small room in the Army's central command military court. The people making the charges, however, are not the Arabs who have chafed under 15 years of Israeli occupation, but seven Israeli soldiers who were part of the occupation force.

Accused of beating, kicking and clubbing students at the Islamic University in Hebron last spring during widespread disturbances in the West Bank, Maj. David Mofaz and six other soldiers have declared their innocence and argued that all the measures they took against the Arabs conformed to the orders and guidelines laid down by their superiors.

Yesterday, the three-member military tribunal that is hearing the case decided to involve the top echelon of the Army by agreeing to a defense motion to hear testimony by Feb. 9 from Chief of Staff Lt. Gen. Rafael Eitan on two controversial documents that have been introduced by lawyers for the soldiers.

The documents, issued by Eitan, called for the punishment of the parents of students who participate in demonstrations, expulsion from the West Bank of Arabs considered troublemakers by the Israelis and "economic punishment" of whole villages known to be centers of unrest by such measures as denying them the right to purchase cement, gasoline and cigarettes.

Eitan said "instigators" should be imprisoned for investigation, without formal charges, for up to 18 days as allowed by Israeli law in the occupied territory, released for a few days and then reimprisoned. "Harass them," Eitan said, according to the documents.

Eitan, according to the documents, also urged the creation of a special "detention exile" camp in the West Bank and said that the Arab population should be informed that "the inhabitants of Jewish settlements in the West Bank must carry arms and open fire when attacked."

The seven soldiers are charged in the military court with assault, illegal use of weapons, negligence of duty, disrupting the discipline and good order of the Army and improper behavior. The charges stemmed from complaints made in May to Defense Ministry officials by three reserve officers who served in the West Bank last spring and who accused some soldiers of acting improperly in quelling the disturbances.

After a lengthy investigation by the military advocate general, formal charges were brought against the seven in October. The investigation also resulted in the dismissal from their posts of two senior officers in the Hebron military command.

Among other things, the prosecution has charged that one of the soldiers forced a Palestinian youth in the West Bank town of Halhul to get down on his hands and knees and bark like a dog, and on another occasion ordered an Arab man to slap another in the face.

However, largely under the prodding of Yehuda Ressler, a flamboyant Tel Aviv lawyer who is representing Mofaz in the case, the trial itself has turned not just on the behavior of the individual soldiers but on the Israeli Army's policies in dealing with the Arab population of the West Bank. By adopting as one line of defense the contention that his client was simply following orders, Ressler has thrown a spotlight on those policies and in some ways put the prosecution--the Army--in the position of the accused.

One result of this tactic was the summoning of Eitan, believed to be the first time a chief of staff has been called to testify in such a criminal proceeding.

Before agreeing to call Eitan as a witness, the military court heard testimony yesterday from Maj. Gen. Uri Orr, the Army's central commander, who denied there was an Army policy of harassment and severe punishment directed against the Palestinian Arabs.

"At that time," Orr said, referring to the wave of unrest that swept the West Bank after Israeli authorities fired several elected Arab mayors, "extremists wanted to disturb the order as much as possible. My aim was to bring about quiet."

Despite the unrest, Orr said, he instructed his soldiers to keep Arab casualties to a minimum, not to fire their weapons unless their lives were endangered and to use minimum force to control any situation.

Israeli soldiers killed 10 Palestinians and wounded 90 others during the spring disturbances. Two soldiers were killed and 33 others were wounded as a result of the clashes.

Orr said a special detention camp established in the West Bank after the Eitan documents were issued was necessary because existing jails and other facilities were full. He said the documents represented "no change in policy" and contained "nothing exceptional or illegal."

In earlier testimony, Mofaz, the senior officer facing the charges, attempted to link Defense Minister Ariel Sharon to a policy of brutality toward the Palestinian Arabs.

Mofaz testified that he was told by another Army officer that during a meeting at the Israeli civil administration headquarters in the West Bank Sharon had said the Army should "rip the testicles off" Arabs caught in demonstrations.

When he and others were ordered into the Islamic University in Hebron last spring, Mofaz said, their orders were to remove the students in small groups, "detain them, photograph them and deal with them."

Asked what he understood to "deal with them" meant, Mofaz said, "I understood to beat them--to deal with those who deserved to be dealt with." He said this was "the atmosphere and the policy at the time, including to beat detainees."

Another witness testified that Mofaz's former commanding officer, Lt. Col. Shalom Lugassi, had issued orders to beat local Arab residents, break their watches and generally pester them as punishment for infractions under the occupation government.

Earlier this week, Eitan, appearing at a seminar in Tel Aviv, was asked about the documents that have been introduced in the trial of the seven soldiers. "None of these methods was illegal," he replied.