How do I go about fixing the brake lever? It does not retract back to its original position.

It’s probably either the return spring(s) at the brake caliper or brake cable/housing that needs replacing. You can disconnect the cable at the caliper and squeeze with your hand. If the caliper has a good firm spring force trying to open it then it could be the cable housing. You can try some lube like triflow on the cable/housing, but this is usually just a short term solution and it can attract dirt and make things worse in the long run.

Cable is not moving freely in the housing. Consider adding lube or better yet replace cable and or housing.