As per law, they must collect local VAT and issue local state address (Branch office) invoice. After all they have own delivery network in each state.
It's huge loose poll inside, even above 5K worth of item buyer can't buy from other state, if required buyer must be demand way-bill from Sales Tax department. That's why lot of e-commerce sites not shipping items in WB and Assam.
No if the buyer sells directly with VAT only then no need of CST as explained... As for CST he has to prove that he sold out of state(So the seller needs C Form) he can VAT rebates....