What was found
(CAN) MODE 'C' INFORMATION BEING GIVEN TO ATC GIVES INCORRECT ALTITUDES. PILOT TOOK SOME READINGS. ALTIMETER INDICATOR AT 4,500, WHILE MODE C' AT 4,400, AND SO ON UP TOTAL. INDICATION AT 10,500 WHILE MODE 'C' AT 9,300. DURING DESCENT, MODE 'C' WAS SHOWING A CLIMB. COPILOT'S ALTIMETER WITHIN 50 FEET OF THE ENCODING ALTIMETER READING.