Iqbal's grandson Waleed Iqbal has come from Pakistan to receive the award at Nazrul Manch from the West Bengal government-run Urdu Academy.
Urdu Academy chairman and Trinamool MP Sultan Ahmed said the CM would hand over the award.
On the occasion, Banerjee would also be felicitated with the title of 'Pasban-e-urdu' (Defender of Urdu).
An Urdu book of poems 'Tamanna', written by her, would also be released.
A three-day international literary festival organised by the academy on the theme of 'Saare Jahan se Achcha' would also be kicked off here from tomorrow.
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Scholars from Pakistan, Mauritius and Afghanistan would present research papers on the life and works of the legendary poet during the seminar.
Altogether 45 international delegates including poets from six nations would attend the function.
A section of the library of the West Bengal Urdu Academy will be dedicated to literature of Iqbal during the festival which would end with a 'Mushaira' on Iqbal.