WASHINGTON, Feb 26 (AFP) - Microsoft's lead attorney came under surprisingly sharp questioning from a federal appeals panel here Monday as he sought to convince the court the company had not tried to stifle competition.

The seven-judge panel turned up the heat on attorney Richard Urowsky on the first day of a two-day hearing before the US Court of Appeals.

The tone of the questioning shattered the notion that the appeals panel might be more sympathetic to Microsoft, which is trying to overturn a lower court ruling that it violated antitrust law and should be broken up.

Urowsky insisted that while Microsoft enjoyed a powerful position in the market for personal computer operating systems, it had not abused such power and had done nothing to harm the operations of rival Netscape.

"Microsoft did nothing to foreclose Netscape from any marketplace," he insisted.

He also denied that the company, with its market-dominant Windows platform, had a monopoly in the operating systems market.

"There is no question that Microsoft has some market power but that does not represent monopoly power."

Jeffrey Minear, representing the US Justice Department, also confronted a series of pointed questions from the court.

Chief Judge Harry Edwards challenged the government's contention that an alliance between Netscape and Sun Microsystems -- and its Java programming language -- had threatened Microsoft, prompting it to try to eliminate competition in the software sector.

Netscape, according to Edwards, had neither the ability nor the intention to threaten Microsoft.

Attorneys for the software giant and the US Justice Department will have a total of seven hours -- equally divided between the two sides -- spread over two days to present their oral arguments.

Microsoft is challenging findings by US District Court Judge Thomas Penfield Jackson, who last April upheld charges by the Justice Department and a coalition of states that the company had abused its monopoly position in the personal computer operating systems market and had sought to snuff out competition.

Microsoft also rejected Jackson's subsequent directive, issued in June, that it should be split into two entities, one to develop its Windows operating platform and another to specialize in software applications.

Legal experts have said the company stands a reasonable chance of getting Jackson's "remedy" -- the breakup directive -- reversed.

"The remedy is way too severe given the facts of the case," said Nicholas Economides , a New York University professor of economics and an antitrust expert.

"The most likely (outcome) is that they will find Microsoft liable on some points and then send it back to the district court to discuss a remedy in much greater detail."

Economides suggested that in place of the breakup order, the district court could impose restrictions on Microsoft's corporate conduct -- notably affecting its relations with computer makers -- while keeping the group intact.

The appeals court will be considering whether Microsoft, as Jackson found, violated antitrust law by exploiting the market- dominant position of the Windows platform to hamper the operations of rival software providers.

In particular, the court will focus on Microsoft's decision to "tie" its Internet browser Explorer to the Windows system, which according to the government was done to thwart sales of the Navigator browser offered by Netscape.

The seven judges will also review the remedy imposed by Jackson as well as his conduct of the trial and his out-of-court remarks to the press, which according to Microsoft revealed a bias against the company.

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