The former chairman of Ashland Oil Inc. was secretly arrested and charged with transporting stolen company documents sought by representatives of Iran for use in a $500 million lawsuit against Ashland, court rec-ords, law enforcement officials, Ashland executives and defense attorneys said.

The former chairman, Orin E. Atkins, was arrested by federal agents in Manhattan in July, law enforcement officials said and court documents show.The arrest came after U.S. Customs Service agents surreptitiously videotaped a conversation in which Atkins told a business associate to sell two confidential 1979 Ashland memorandums to Iran for $600,000.

The precise nature of the documents has not been disclosed, but they presumably would have been of value to Iran in its lawsuit against Ashland.

The lawsuit involves oil contracts between Ashland and Iran, including seven tankers of oil Ashland acquired from Iran but did not pay for during the turbulent days of the Iranian revolution in 1979.

The investigation grew out of an Ashland decision in mid-1987 to hire private investigators to look into reports that stolen documents were for sale.

The company learned of the possibility after a New York Times reporter asked about reports that confidential documents were for sale.

Information subsequently obtained by the private investigators was turned over to federal agents, who began their own investigation.

Papers filed in Federal District Court for the Southern District of New York disclosed the existence of the inquiry, but law enforcement officials said they had kept the arrest of Atkins and Roy Furmark, the business associate, under court seal in hopes of pursuing Iranian figures in the case.

Law enforcement officials said the investigation was terminated Friday.

Atkins pleaded not guilty after his arrest and was released, authorities said.

Two attorneys for Atkins, John E. Jenkins Jr. of Huntington, W. Va., and Martin Pollner of Manhattan, acknowledged in interviews that Atkins had been arrested for interstate transportation of stolen property.

John Lang, who also represents Atkins and is a partner of Pollner's, issued a statement that said Atkins denied "any and all allegations of wrongdoing." He said that "when all the facts are known, Atkins will be totally exonerated."

Lang said Atkins was traveling and could not be contacted. No one answered telephones at Atkins' homes in Florida and West Virginia.

Furmark did not return messages left at his Manhattan office. The telephone at his home in Brooklyn was answered by his son, who said Furmark was traveling and unavailable for comment.

The court papers filed in New York show that two other individuals have been charged with interstate transportation of stolen documents: Charles H. Dougan, a former vice president of Ashland, and Charles Barnett, a Florida lawyer whose father, now deceased, did considerable legal work for Atkins and Ashland.

Dougan has pleaded not guilty to the criminal complaint. He declined to discuss the case with a reporter who reached him at his home in Princeton, Ind.