A supplier mentioned this as one of the CCTV camera features. What is this? I did not find it anywhere in any camera datasheet.

I just found it is related to what is so called "Smart IR Functions", and this is to keep generating acceptable image at monochrome mode even if the subject is very close to the IR illuminators. So no complete blank white face (without details) would be shown.

But is this a standard feature of any day/night camera or it is a special one?

This is what 'saturation'/ 'over saturation' / 'over exposed' looks like:

It's a common problem when using IR illuminators, whether add on or integrated into the camera. The amount of power needed to see far away makes it overpowering to objects close to the camera. Some cameras with integrated IR dynamically turn down the IR power when they detect people/objects close to the camera to rectify this.

See our IR Surveillance Tutorial for more on this.