sagarkumar: As you might see, kuruman is applying the general principle that internal forces cannot affect the position of the center of mass of a body (or of a system of bodies). This can be seen as a consequence of the first law of motion or of the law of conservation of momentum. That gives a direct path to your initial question:
would whole system shrink towards the center or just the bodies at the terminal ends because rest of the bodies are experiencing equal and opposite forces
It is not clear to me if you see what that analysis tells you about the how the masses end up. What you wrote in post #6 suggests you think there
will be a symmetric collapse toward the center of mass.
kuruman: I think your analysis is an elegant example of finding parallels between the behavior of particles and groups of particles. I will be stealing this for my high school physics course.
As I consider all this, it seems to me the nature of the forces acting on the masses are presented in three ways:
1) Springs act (in the original post), so the magnitude of the force between each ball and its neighbor decreases proportionally to the separation of the balls.
2) The "forces are applied at the same and for one instant only then goes off" (post #6). That can be achieved through small explosions on the left and right of every mass except the terminal masses, which would have explosions only on the terminal sides. There is a very brief, simultaneous initial acceleration for the terminal balls and the others initially remain at rest.
3) A "constant force keeps on acting" (also post #6), so it is like having opposing rockets attached each side of each interior that fire constantly. There is a continuous acceleration of the terminal balls while the others initially remain at rest.
The end result is the same in all three cases, but sagarkumar refined the initial question to ask about how the collapse to the center of mass proceeds.
Which case are you using in your answer to the refined question? You conclude that the collapse is simultaneous throughout the system, whereas the second and third cases I presented (and the first if you take into account the time needed for the the decrease in tensions to move radially inward) make me think only the terminal balls move initially.