Insert data by joining tables

Maybe you can try something like this:

insert into INCEPTION_TABLE select
ITEM, SCAN_ID, VENDOR from
(select a.ITEM, a.SCAN_ID, a.VENDOR
from
select RJ_SONIC_STAGING a where a.VENDOR is not null
UNION
select a.ITEM, a.SCAN_ID, b.VENDOR
from RJ_SONIC_STAGING a,CONFIG_TABLE b
where a.STATE_ID=b.STATE_ID and a.VENDOR is null)

thank you for the reply.
Let me rephrase my question. i am sorry for the trouble.

I want to insert only those records in table 3 where VENDOR is NULL in table 1.
and while inserting into table 3, i want to join the STATE_ID of table 1 with STATE_ID of Table 2 and fetch that record

basically something like this

Insert into INCEPTION_TABLE
(
ITEM,
SCAN_ID,
VENDOR)
select
ITEM,
SCAN_ID,
-- here i am not sure how to fetch data from table 2 and join with the STATE_ID
from RJ_SONIC_STAGING
where VENDOR IS NULL;

This ought to do it:

Insert into INCEPTION_TABLE
 select a.ITEM, a.SCAN_ID, b.VENDOR
from RJ_SONIC_STAGING a,CONFIG_TABLE b
where a.STATE_ID=b.STATE_ID and a.VENDOR is null;

"I am having below 3 tables"

Yes, speakers of English outside of India can understand what you mean by this sentence, since those are all English words, but that is distinctively "Indian English" word order that looks quite foreign to native speakers of English.

First, we use "am having" only for very temporary conditions.  For long-term, or ownership or (almost) permanent conditions, we say: "I have...".

Then the English word "below" is not an adjective, it is an adverb, so we never put it in a sentence where an adjective is expected.  We would say: "I have the three tables below:" or "I have three tables, described below:".

The last suggested solution from Helena looks pretty good to me, but I would write the last line like this:
where b.STATE_ID=a.STATE_ID and a.VENDOR is null;
so the "known" value is always to the right of the "=" sign, and the first table listed in the "from" clause is the "driving" table tht Oracle starts with.