Is it permissible to supplicate for your deceased father-in-law that his abode be honored and he be granted residence in Paradise?

Praying for the deceased for forgiveness and a noble abode is مطلوب (desirable/required), whether the person was a relative or not. This includes the husband's father. The Prophet, peace and blessings be upon him, prayed during the funeral prayer: "O Allah, forgive him, have mercy on him, pardon him, and grant him well-being. Make his abode honorable and widen his entrance. Wash him with water, snow, and hail, and cleanse him from sins as a white garment is cleansed from dirt. Give him a home better than his home, a family better than his family, and a spouse better than his spouse. Protect him from the trial of the grave and the punishment of the Fire."