RCPT TO email address domain or ip address?

Using Exchange 2003.  We are running a test email scenario through the following:

1. telnet 25 (email server)
2. type in: MAIL FROM: Sender@Sender_domain.local
3. RCPT TO: Destination@destination.local
4. SUBJECT: Test <CRLF then . and CRLF>
**Mail goes through fine..**

Next Scenario with IP in RCPT TO::
1. telnet 25 (email server)
2. type in: MAIL FROM: Sender@Sender_domain.com
3. RCPT TO: Destination@
4. SUBJECT: Test <CRLF then . and CRLF>
**Mail does not go through**

Is there a RFC that states what a valid RCPT TO: has to include? (ip addres OK, or domain name necessary?)

 It was my assumption that best practice was to use user@domain_name.local and if that wasn't resolvable via public DNS (like Destination@destination.local), the net best thing is you would build a host alias entry on the "hosts" file of the sending mail server to get it to look like normal email.  In this example the DNS domain_name.local may be over a leased line, not a domain that exists on the root server DNS.
Who is Participating?
Needs to be a domain name and yes you can add entry to hosts file to get round DNS issue
JRoyseAuthor Commented:
Thanks - I agree that a domain name is important, but is it necessary (like a RFC #)?
JRoyseAuthor Commented:
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