Allah Most High says:
“Had Allah known any good in them, He would have made them hear.”
As for the deceased’s ability to see, reports concerning this have been transmitted from ‘Ā’ishah and others.
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As for the question, “Is his soul returned to his body at that time, or does it hover over his grave then and at other times?”—his soul is returned to his body at that time, as stated in the hadith, and it is also returned at other times.
The souls of the believers are in Paradise, as stated in the hadith related by al-Nasā’ī, Mālik, al-Shāfi‘ī and others:
“The believer’s soul is a bird that feeds among the trees of Paradise until Allah returns it to his body on the day He resurrects him.”
In another wording:
“Then they take shelter in lamps suspended from the Throne.”
Nevertheless, they connect with the body whenever Allah wills. This happens in an instant, like the descent of an angel, the appearance of a ray of light on earth, or a sleeper’s awakening.
Several reports also state that souls remain in the vicinity of graves. Mujāhid said:
“Souls remain in the vicinity of graves for seven days from the day the deceased is buried, without leaving him.”
This happens on occasion. Mālik ibn Anas said:
“It has reached me that souls are free to go wherever they wish.”
And Allah knows best.