[Ruling on Elevating Graves and Placing Plaques upon Them]

Answer—and Allah is the One who grants success: There is no objection to raising the graves of scholars and virtuous people with additional construction—in order to distinguish them from other Muslims—and likewise to writing upon stones and placing them over their graves so the living may recognize and distinguish them.
This may be adduced from His saying, Exalted is He: “Allah will raise those of you who have believed and those who were given knowledge in degrees.” [al-Mujādilah:11]
A Muslim ought to observe this elevation which the Lord of servants has decreed for the scholars; and there is no doubt that a scholar’s elevation does not cease with his death.
Thus, observing that elevation after death does not fall outside the laws of the religion and the rulings of the Lord of the worlds.
If it is said: Observing that great elevation pertains to the belief of the heart, and then to good mention—this with respect to those morally responsible, whether the scholar is alive or dead.
We say: When the heart believes in the loftiness of the scholar and the elevation of his rank, bodily actions and the tongue will manifest traces and signs of that belief—whether the scholar be alive or not.
It is known in Islam that there is no objection to manifesting a true belief—whether by word or by deed: one may praise the scholar, extol him, honor him by service, courtesy, lowering the voice, and so forth. All of that is a translation of what is in the heart of esteem, reverence, and elevation.
What we have mentioned—raising the grave and inscribing the name—is nothing more than a translation of what is in the heart of reverence for the scholar in his grave. It is established in the report: “The sanctity of a Muslim when dead is like his sanctity when alive.”
As for everything cited to prohibit this, it is only what is narrated in their Ṣaḥīḥ collections: “Do not leave a raised grave without leveling it.” They have no proof therein for what they claim, because what is meant by a “raised” grave is one with parapets/projections, and what is meant by “leveling it” is leveling its parapets.
If the intended meaning were as they interpret, then the grave would have to be leveled with the earth entirely, and it would be forbidden to raise it even a handspan—or less—above the ground.
Source : Min Thimār al-ʿIlm wa al-Ḥikmah vol.1