Following are excerpts from testimony yesterday by Lt. Col. Oliver L. North, questioned by Rep. Louis Stokes (D-Ohio) on North's involvement in paramilitary operations inside Nicaragua during the period of the Boland Amendment, which banned any direct U.S. involvement in such activities.

On March 6, 1985, an arms depot in Managua, Nicaragua, was destroyed by an explosion. What was your role in arranging for the explosion?

I personally had no role in it whatsoever. It is my understanding that foreign operatives were engaged in that activity and assisted therein. We talked of that in the executive {closed} session the other night, sir.

I'm not going to get into classified materials. This is different. Was David Walker {a British mercenary} hired to conduct that operation?

David Walker was not hired to conduct any specific operation -- certainly not by me. Mr. Walker was engaged to provide operational support for certain activities in the region, as I understand it. And I do not know the contractual relationship he had with anyone in these activities.

Who paid Mr. Walker for conducting that operation?

It is my understanding, and I do not want to speak with absolute definity on it -- you have seen the documents that I have provided to the committee, or that were provided to the committee from my files -- it is my understanding that he was paid by the Nicaraguan resistance {the contras} or by {retired major} general {Richard V.} Secord.

Did you have to arrange any type of approval in conjunction with his work there?

I am quite certain that I sought the approval of my superiors -- I don't recall the specific event, but when Mr. Walker's advice and counsel was sought on those kinds of activities, I'm sure that I informed my superiors . . . .

Was there any discussion with your superiors about the possibility that this action might violate the Boland Amendment?

No, I don't recall any such discussions and, furthermore, I don't recall any specific planning on my part for that specific activity, prior to . . . the event.

Colonel, your full-service covert operation sounds to me . . . like the CIA's reserve for contingencies fund. You're aware of that fund, aren't you?

I am, sir.

Stokes then made the following statement on North's activities:

Let me tell you what I think the difference is between the CIA's reserve for contingencies and your operation. Their contingency fund requires the approval of the president, requires review of the NSC {National Security Council} and notification to Congress. Your covert operation was different. Your operation had no presidential approval; it had no finding. All the covert operations I know of had findings. Your covert operation had no financial accountability . . . . Your covert operation generated and spent funds for projects that were not the subject of appropriation requests. And, finally, your covert operation was not subject to oversight by the Congress, by the statutory members of the National Security Council, and, according to your account, the president . . . .

Sen. Warren B. Rudman (R-N.H.) made the following statement:

. . . Something has occurred in the last 48 hours or the last 72 hours that is . . . so disturbing to me that I wanted to say what I'm going to say, probably over the chairman's objections. And I'm sure Col. North will agree with every word that I say . . . .

We received some calls in the committee and our offices over the last 72 hours of ugly ethnic slurs against our chairman {Sen. Daniel K. Inouye (D-Hawaii)} and other kinds of calls that were extraordinarily insulting to the members of this committee. Col. North has been respectful of this committee; I think this committee has been respectful of Col. North. There seems to be {a} vision out there, not shared by this witness or his counsel or by most Americans, about this committee that I want to set straight. Represented on this panel are 16 members who served in the service, eight who served in combat, a number with great distinction -- with medals for valor and heroism from Guadalcanal to the Lingayen Gulf. The chairman was recommended for the Congressional Medal of Honor for assaulting two German machine-gun nests in northern Italy, and then falling on the third one, which was destroying his company, when he lost his arm, which he left on that battlefield in Italy. He holds the nation's second highest award -- the Distinguished Service Cross. He is one of the greatest men I ever have known, and the country ought to know the kind of leadership the Senate chairman exerts -- and for all Americans to condemn the kind of ethnic slurs that have no place in America.

Rep. Edward P. Boland (D-Mass.) then questioned North.

The senior CIA official in Central America has testified that during the time when military assistance to the contras was prohibited by U.S. law, he was active, at your request, in assisting the Secord lethal resupply operation. Another had testified that the assistance of this official was crucial to the success of the Secord operation. Who in the CIA authorized you to bring this individual into the resupply network?

Director Casey.

Who else in the agency did you know to be aware of his activities besides Director Casey?

. . . I'm sure that the Central American task force chief was aware . . . but I can't state that with certainty.

Colonel, in my judgment, the law is clear. It authorized the provision of certain types of intelligence information to the contras. It did not authorize CIA officials to coordinate the aerial supply or resupply of the arms to the contra units in the field. . . . The supply of fighting units in the field is a military operation, and CIA participation in that type of operation was not authorized by law. That's correct, isn't it?

I am not certain of that, Mr. Boland . . . .

Well, wasn't the CIA barred from getting into military operations under the amendment?

It certainly was barred from expending funds for those purposes -- no doubt about it.

Several witnesses who have testified and made references to the assistance provided to the Secord-contra arms resupply effort by Col. James Steele, the then military assistance group commander in Country Seven {El Salvador}. Who in the Department of Defense had authorized Col. Steele's participation in this operation?

I don't know, sir.

Did you ever report to anyone in the Defense Department about the help Col. Steele was providing to the Secord resupply effort?

. . . It is entirely possible that Adm. {Arthur S.} Moreau {Jr.} and I talked about it. It is possible that I talked about it with Gen. {Paul F.} Gorman or his replacement, but I don't recall those specific conversations.

. . . You have testified that you . . . had been advised that the National Security Council was not covered by the Boland Amendment . . . . I believe that advice was wrong . . . . The CIA was covered by the Boland Amendment; so was the DOD and also the State Department . . . . Why do you believe you had the ability to direct employes of those agencies to do things which the law said they couldn't do?

. . . I will take issue again with the word "direct." I certainly solicited from them help. If I didn't solicit money, I sought help, and I did seek a lot of that, and they provided it. My understanding of the Boland proscription was that funds could not be expended for those purposes, and I don't know that any of those people engaged ever expended a nickel on behalf of the programs I sought their help for.

Following is former national security adviser Robert C. McFarlane's statement to the committee and his response to questions by Sen. Rudman :

Col. North testified that I gave him general authority to conduct covert operations involving widespread military and paramilitary activities, based upon the position that the Boland Amendment did not apply to the NSC staff. He also stated that he kept me advised of all of his activities. Col. North did report to me from time to time on a few, but certainly not all, of the activities that went beyond mere political support for the contras . . . . Col. North testified that he and Director Casey had agreed upon a full-service operation to support the contras using nonappropriated funds. I never heard of any such full-service operation from either . . . Casey or Col. North, and I certainly never concurred in one . . . . Col. North has testified that he did not recall that I had directed him not to solicit funds to support the contras. I did instruct him not to solicit funds . . . . Col. North testified that I directed the White House chronologies be altered to say that everyone in the United States government believed, in November 1985, that "oil-drilling parts" were being shipped by the government of Israel. This is not true . . . . No such plan existed, to my knowledge {to have someone be the fall guy when the operation unraveled}.

. . . When they talked about the off-the-shelf, covert, privately funded, off-budget, nonaccountable capacity, that's what {compelled McFarlane to return to rebut North}.

That's correct . . . .

. . . This broad-ranging resupply effort . . . in terms of being generally informed, you were, but in terms of being specifically informed, you weren't?

. . . I was generally aware that the contras were being resupplied . . . Whether or not Col. North was involved to the extent that seems now evident, is another matter.

. . . I guess what you're saying is . . . that you were not aware of the extent of his involvement?

That's correct . . . . I briefed the president on what I thought Ollie was doing . . . . But my judgment . . . was that no one single human being could undertake the sufficient scale of activity to be in conflict with the law, which I saw to be . . . mostly a prohibition on raising money. And in no sense was I aware of those activities.