why are you adding lblHeader to self.collectionView add to headerView.And return headerView.Replace your code with it
if (kind == UICollectionElementKindSectionHeader) {
UICollectionReusableView *headerView = [self.collectionView dequeueReusableSupplementaryViewOfKind:UICollectionElementKindSectionHeader withReuseIdentifier:nil forIndexPath:indexPath];
self.lblHeader = [[UILabel alloc]initWithFrame:CGRectMake(120, 10, 100, 30)];
self.lblHeader.backgroundColor = [UIColor whiteColor];
self.lblHeader.textColor = [UIColor redColor];
self.lblHeader.text = @"Level 1";
// [self.collectionView addSubview:self.lblHeader];
[headerView addSubview:self.lblHeader];
return headerView;
}