I am building up my lawn as current one was messy and home to rice and rats crossing from the neighbour with the help of some videos here, here and I have taken out some old turf and still in process. Attached is the image. My question if we can separate soil from grass/turf as shown in the heap and reuse the soil before putting compost and new turf or should I throw that away. Edit: I have dug and clean the soul. Here are new photos. What is the light colored soil?
You can reuse some of the soil, if you have the time to shake it off the roots of the weeds and grass; dispose of the weeds completely,but any grass can be stacked up, face down, somewhere out of the way. This will eventually compost down and you can then use the resulting composted, soil like material on the garden, in beds or wherever you need it.
You do need to dig over the area and remove weed roots after you've scraped off the top layer of grass and roots, otherwise they will simply grow back through your new lawn. Once dug over, rake it over so it looks flat, then walk over it closely on your heels to get out soft spots, re rake and re-level. You may need to do this more than once; alternatively, if you can, leave it a few days to settle without walking on it prior to turfing and re check the levels just before laying the turf. Use a board to work off when laying the turf to spread your weight so as not to compress areas you're kneeling or standing on whilst doing the job.
I'm not sure what you mean when you say 'building up' the lawn; it suggests you might mean you want to change the levels by adding or removing soil. If you do want to do that, use topsoil, not compost.
Following on from your comments below, you do need to remove the grass and weed roots from the ground; you want the top 3 or 4 inches of the soil to be friable and fairly loose in order for turf to root into it properly. Digging over deeper than that and properly first also means you can remove any debris you can't see currently, such as buried bricks or rubble, so now that you've scraped off the top of the grass, you will need to dig it all over and take out root material - its particularly important to get out deep roots like those of the dandelions as well. Do it with a full sized garden fork rather than a spade it's easier. When you've done that, rake it more or less level, then you'll need to work out how much topsoil you need to make the turf level with the paving - bear in mind that turves are usually somewhere around 2 inches deep. Make sure you use topsoil, not compost - if you need a lot, you can have it delivered, usually in very, very large bags, otherwise, it's available at garden centres in 20 or 40 litre bags. As for the grass you've scraped off, bin it or add to your compost heap (excluding the weed roots, don't add those to the compost) after shaking off any excess soil.