How much tax if business partner passed away [no contract]

In my view.

If there is no agreement between you and partner, then it would be difficult to prove the partneship. However, since you are receiving the amount and paying 50% of it to your partners parents, If at all the entire income is taxed in your individual file, you can claim the 50% paid to partners parents as revenue sharing or commission or salary, whichever nature seems much prudent.

you can wait for other views as well.

It will be taxable in your hand, it is called application of income...

Dear Gautam,

Its correct that as far as revenue is concerned, the title remains with you.

It is further commendable that you are showing your humane side by sharing the revenues with your deceased partner's parents. 

However, to manage your tax liability, it shall be prudent that you either request your deceased partner's parents to either receive the said income as salary ( a much better mechanism) or as commission (this becomes difficult to justify if they don't possess any skills to justify sharing of commission generated from apps development business.

If you don't do either of the above, the said income shalll be taxed twice - once in your hands as business income and then in the hands of the recepients as income from other sources.