Whether pension received post retirment through superannuation scheme is taxable?

As per Section 10(13) of the Income tax act "any payment from an approved superannuation fund made -
(i) on the death of a beneficiary; or
(ii) to an employee in lieu of or in commutation of an annuity on his retirement at or after a specified age or on his becoming incapacitated prior to such retirement; or
(iii) by way of refund of contributions on the death of a beneficiary; or
(iv) by way of refund of contributions to an employee on his leaving the service in connection with which the fund is established otherwise than by retirement at or after a specified age or on his becoming incapacitated prior to such retirement, to the extent to which such payment does not exceed the contributions made prior to the commencement of this Act and any interest thereon; "

It is evident from the above that superannuation received at the time of death, retirement, incapacitation prior to retirement is exempt to tax and superannuation received at the time of resignation is chargeable to tax. This section explicitly states that commuted superannuation at the time of retirement is exempt from tax. Now the question that arises is when the employee decides not to commute his superannuation and opts to receives it in monthly/quarterly/halfyearly/annual streams, whether shelter under the aforesaid section can be taken? In this context, the interpretation of words "to an employee in lieu of or in commutation of an annuity on his retirement " assumes importance. Can it be construed that receiving superannatioen - pension in monthly/halfyearly/quarterly/annual streams is in lieu of commutation? There are no decided case laws on this point.

Employer contribution to Superannuation is not subject to tax in the hands of employees but is subject to FBT(exceeding Rs.1 Lakh). Any payment made by a company to a approved superannuation fund is an eligible deduction.

However employee contribution to Superannuation is subject to deductin u/s 80CCC. (limit of Rs.1 Lakh read with 80C). Section 80CCC is also specific on the point that any pension received by employees post retirement out of superannuation contributed earlier, and claimed as deduction is chargeable to tax. In many companies superannuation is only contributed by the employer and does not have any employee contribution.

A favourable interpretation of 10(13) would render the non-commuted superannuation (after retirement) exempt and 80 CCC (employee contribution alone) renders it taxable.

However going back to FM's speech during 2005-06 at the time of scrapping rebate u/s 88 and introducing 80C, the concept of EET (Exempt Exempt tax) was emphasised. Approaching this issue with the concep of EET in mind
-Employer contribution is tax deductible (subject to FBT) and hence escapes corporate tax
-Employee contribution is exempt u/s 80CCC (additions to the fund by way of interest is also exempt)

Extending the corollary of 80CCC to employer contribution, it is obvious that the legislative intent is not to exempt superannuation income post retirement (non - commuted).

However why commuted superannuation is exempt from tax is still a paradox.