Suppose that $X$ is a paracompact topological space and let $S \subseteq X$ be a closed subspace.
It is well-known that $S$ itself is paracompact, when equipped with the subspace topology.
But what about the following:
Let $\mathcal{U}$ be a covering of $S$ by sets open in $X$. Does there exist an open locally finite refinement $\mathcal{V}$ of $\mathcal{U}$ that is a covering of $S$?
I have seen authors who say that $S$ is paracompact in $X$ if any such $\mathcal{U}$ has got an open refinement $\mathcal{V}$. But this terminology is not common and I have doubts whether the concept makes sense.
Such concepts have been discussed but they have remained a niche topic.
A paper that might interest you discusses "relative" topological properties: Arhangel'skii, A. V. "Relative topological properties and relative topological spaces." Topology and its Applications 70.2-3 (1996): 87-99.
It seems that your concept of "$S$ paracompact in $X$" is actually a bit stronger than the one by Arhangel'skii: he only requires that the refinement is locally finite over $S$, but you also require that it is locally finite over $X$ as well.