Why am I always asked to install Command Line Developer Tools when already installed?

It seems you have hit a bug.

Macs usually have case-insensitive file systems, so there would be no difference between /usr/bin/cc and /usr/bin/CC. Both would be the same file, the same program.

However, that is ofcourse different when you run macOS on a case-sensitive file system.

I assume the Xcode developers at one point had considered this and installed a stub at both cc and CC on case-sensitive file systems, so that an attempt to invoke either compiler would show the prompt. Then later someone made it so that when the Xcode command line tools are actually installed, they only install the cc file, and not the CC file.

If you are an Apple registered developer, you can use Feedback Assistant to report this bug to Apple.

If you are not, then you can use the general feedback page to notify Apple about the problem.