@Ajmal Ellath - Thanks for the question and using MS Q&A platform.
According to official documentation: For each label, the Azure portal displays only the label display name, which you can edit. Users see this label name in their apps.
The Microsoft Purview compliance portal shows both this display name for a label, and the label name. The label name is the initial name that you specify when the label is first created and this property is used by the back-end service for identification purposes. When you migrate your labels, the display name remains the same and the label name is renamed to the label ID from the Azure portal.
Microsoft Purview Information Protection unified labeling client the label ID remains the same even if you change the label name later on.
For more details, refer to MS Q&A thread addressing similar issue: Change the name of sensitivity labels (MIP).
Hope this helps. Do let us know if you have any further queries.
If this answers your query, do click Accept Answer
and Yes
for was this answer helpful. And, if you have any further query do let us know.