It's downloaded probably because there is not Adobe Reader plug-in
  installed. In this case IE (it doesn't matter which version) doesn't
  know how to render it and it'll simply download file (Chrome, for
  example, has its own embedded PDF renderer).
That said.  is not best way to display a PDF (do not forget
  compatibility with mobile browsers, for example Safari). Some browsers
  will always open that file inside an external application (or in
  another browser window). Best and most compatible way I found is a
  little bit tricky but works on all browsers I tried (even pretty
  outdated):
Keep your  but do not display a PDF inside it, it'll be filled
  with an HTML page that consists of an  tag. Create an HTML
  wrapping page for your PDF, it should look like this:
<html>
<body>
    <object data="your_url_to_pdf" type="application/pdf">
        <embed src="your_url_to_pdf" type="application/pdf" />
    </object>
</body>
</html>
Of course you still need the appropriate plug-in installed in the
  browser. Also take a look to this post if you need to support Safari
  on mobile devices.
1st. Why nesting  inside ? You'll find answer here on
  SO. Instead of nested  tag you may even provide a custom
  message for your users (or a built-in viewer, see next paragraph).
2nd. Why an HTML page? So you can provide a fallback if PDF viewer
  isn't supported. Internal viewer, plain HTML error messages/options
  and so on...
It's tricky to check PDF support so you may provide an alternate
  viewer for your customers, take a look to PDF.JS project, it's pretty
  good but rendering quality - for desktop browsers - isn't as good as a
  native PDF renderer (I didn't see any difference in mobile browsers
  because of screen size, I suppose).
See also: HTML embedded PDF iframe