For me, the discussion is always between The Empire Strikes Back and The Godfather Part II.
The Empire Strikes Back expands Luke, Han, and Leia's characters and develops them in ways that are polar opposites of the original film. Luke is broken down. Han is humbled. Leia becomes vulnerable. The tone of the film is negative. The film has a downer ending. It's so different but so well made. It's everything a sequel wishes it could be in terms of expanding and exceeding the original film in every aspect in a definitive way.
Then you have the flip side of that last statement with The Godfather Part II. Anyone with a shred of pop culture knowledge knows the reputation of the original film. We know The Godfather is considered to be arguably the greatest film of all-time. But when you have a sequel that matches the reputation of a predecessor of that stature and the argument can be made that it even exceeds it, how can that not be worthy of "greatest sequel of all-time"?