Riyad Us-Saliheen (Gardens of the Righteous)

Chapter 347
Prohibition of Sitting on the Graves

1766. Abu Hurairah (May Allah be pleased with him) said: The Messenger of Allah (PBUH) said, "It is much better for one of you to sit on a live coal, which will burn his clothes and get to his skin than to sit on a grave.''
[Muslim].

Commentary:  To sit on the grave is strictly prohibited [see Hadith No. 1758]. Ibn Hajar Al-Haithami and others, however, regard this act to be only Makruh (undesirable) and maintain that the warning contained in the Hadith is for those people who sit on them for urinating or defecating. The Hadith also elucidates the fact that graves should be respected and that glorifying the people in them by plastering them or building over them is not permissible.