I don't have that file on CPanel servers, but I do have one on my development system (/var/log/mysql.log). It is a log of MySQL commands (mainly queries) run on the system.
Run &tail mysql.log& to see what it has in it. If it's indeed a log of MySQL commands and you have no use for them, go ahead and delete the file.
If you want to prevent the log from being created in the first place, open &/etc/my.cnf& in your favourite editor and comment out or remove the line: log = /var/log/mysql.log. Restart MySQL for the changes to take effect.