@arunabhabhattacharya-3120 I think you are using curly braces "{" in your application settings which is not required. You need to remove curly braces in you Key Vault reference . Key Vault reference would be like below -
@Microsoft.KeyVault(SecretUri=https://myvault.vault.azure.net/secrets/mysecret/dc85f01090234f109d13b2e92cdb3431)
Please let me know if you this works else provide more details like, code snippet, application configuration screenshots to help you better. I also suggest you to refer to documentation which provides details of accessing secrets from Azure functions.