Which cst form to be issued

Kindly Clarify the CST Forms to be issued in the following Case.

There are 2 transaction happening this case

1) Sale of goods from State 1 (Let say Party 1) to State 2 (Party 2)

2) Sale of goods (those purchased from State 1) from State 2 (Party 2) to State 3 (Party 3) 

For the above, Party 2 is a registered dealer in respective state and Party 3 is an EOU

Party 3 has sent the Purchase order to party 2 and also mentioned

 Documents furnish able by Party 3

 * Form A.R.E 1

 * Form C. T 1

 * H Form

Documents to be furnished by Party 2

  * A.R.E 1 executed

  * Central Excise - Invoice 

Kindly give the guidance regarding what forms to be issued by Party 2 to Party 1 and to Party 2. Also explain us the meaning of A.R.E 1 executed.