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I was taught in school that Sir is the appropriate addressing for a formal letter to say a head of institution or principal. Dear sir shows familiarity which is not preferred. Does this hold today?

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Dear Sir is the normal formal salutation if you know that you are addressing a man. Sir alone is used, at least in the UK, only on rare occasions. It might be found, for example, as a saluation in a letter to the editor of a newspaper, and which is intended for publication.

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