Theft in a manufacturing company - whether domestic inquiry is required for terminating?

Dear Mr Anbu
Pl ask the Supervisor to give the complaint against the persons shared the looty seperately in writing. It is quite possible that without the connivance and support of the collegues, the Supervisor may not have done the theft so long and so much. It is possible that the Supervisor may not give the complaint in writing. Nevertheless, based on the deposition of the Supervisor in the enquiry, you may call for the explanation of all the persons mentioned by the Supervisor. Pl keep everything open and proceed carefully. Regards.
N Nataraajhan, Sakthi Management Services (Hp : + 91 94835 17402)

Apart from the fact natural justice demands full inquiry, the issue of culpability of other employees also comes into focus.The supervisor should be questioned and names of others involved can be found out and they also can be roped in to give their statement.
If fair and open enquiry is done, the chance of subsequent legal challenge if any can be obviated.
Confession by itself can be repudiated later on if supervisor goes in for legal challenge.
It is good that an impartial enquiry be conducted observing principles of natural justice.