In the matter of the Department of Justice and the Inslaw case, a remarkable thing is happening: The stench gets worse.

More in puzzlement than in anger, one has to ask: What has got into Dick Thornburgh? As attorney general, he ought to be doing his darndest to get to the bottom of this disgraceful matter.Instead, he has stalled; he has stonewalled; he has taken refuge in legalisms; he has obstructed efforts of two congressional committees to dig out the facts. And this isn't even his scandal. He inherited the mess from Ed Meese.

The Inslaw case goes back to 1981. William Hamilton, an acknowledged whizbang inventor and developer of computer software, was then working for the old Institute for Law and Social Research (hence Inslaw). He came up with an idea for a program that would manage the heavy case-load of a law enforcement agency.

Once in private employment, he began to develop his idea. He refined it, improved it, named it PROMIS, and in 1982 sold it to the Department of Justice for use in 42 U.S. attorneys' offices. It was a $10 million contract, and it put his tiny firm on the map of software suppliers.

Then everything came crashing down. The program itself worked superbly, but inexplicably the department withheld payments that were due to Inslaw on the contract. The effect was to drive Inslaw into bankruptcy. Later it transpired that the department official at the top of the PROMIS contract formerly had been employed - and fired - by Hamilton.

After months of hearings, U.S. Bankruptcy Judge George F. Bason came to a stunning conclusion: The Department of Justice, that citadel of integrity, had "stolen" Hamilton's invention. Bason entered an injunction against the department. He fixed the government's bill for damages at $6.8 million.

Bankruptcy judges serve 14-year terms, but the recommendation of the attorney general weighs heavily in their reappointment. Bason was not reappointed.

Somewhat embarrassed, but not really discomfited, the department appealed.

U.S. District Judge William B. Bryant ringingly affirmed Bason's findings. Instead of yielding, the department took a further appeal. That appeal is still pending.

Two years ago the Senate's permanent subcommittee on investigations got curious and tried to find out what was going on. The Department of Justice stonewalled the committee so effectively that the investigators turned in a limp report and gave up.

In December a House judiciary subcommittee held a day of hearings on the Inslaw case. Investigators sought cooperation from Thornburgh. Again he stonewalled.

A few weeks ago the plots thickened. Hamilton learned by accident that his

PROMIS software had been illegally sold to agencies of the Canadian government. He identifies the pirates as cronies of former Attorney General Ed Meese and former President Ronald Reagan. The cronies deny everything.

No sooner had the piracy been confirmed in Canada than an Israeli intelligence officer alleged that PROMIS was being used illegally by the CIA and other intelligence agencies. They won't comment.

There is more. The case began before Bankruptcy Judge Bason. After he was fired, the case went to another bankruptcy judge, Martin Teel. He disqualified himself. Then it went to Bankruptcy Judge Paul H. Mannes. He disqualified himself. In 1989 the matter went to Bankruptcy Judge James Schneider.

On Feb. 26 he issued a mystifying order: "The undersigned bankruptcy judge hereby recuses himself from all further proceedings in this case due to potential con-flicts relating to decisions yet to be rendered."

Last November Chief District Judge Aubrey Robinson held a hearing. In response to a suggestion that the case be referred to a bankruptcy judge in Alexandria, Va., he learned "they wouldn't touch it with a 10-foot pole." In fact, he said, "nobody wants to touch the case."

As I said, the stench gets worse.