Yes, I believe Arrested Development tops Seinfeld as my favorite sitcom ever. I'm re-watching season two and laughing out loud regularly.
What's so great? The eccentric characters (G.O.B. Bluth and Tobias Fumke are the best), the running gags ("Her?"), Michael Bluth's facial expressions (Jason Batemen has several great shocked and appalled looks), the continuous incest jokes, the tone and pacing (the death of the sitcom laugh track was long overdue), and a whole lot more.
Ah, but it's all really about tastes. We all respond to different comedic styles differently: I can only call Arrested Development my favorite, not the greatest, sitcom. What makes one laugh cannot always be so easily quantified, and thus shouldn't really be ranked in any way but by individual tastes.