What is the purpose of interface tracking in HSRP? How it works? Will the normal HSRP works if tracking is configured?
Interface tracking enables HSRP process to monitor additional interfaces, the status of which will dynamically change the HSRP priority(Active/Standby).
For e.g. imagine the following scenario.
If you have two serial links to two different ISPs(assume primary/backup Internet connections) connected via two different routers, it would be interesting to have the serial interface connecting to your primary ISP tracked in order to minimize service interruption to your local users. If this serial interface goes down, your backup router can take over the gateway functionality to your local network, while maintaining the connectivity to the secondary ISP(backup).
Users would still be able to access Internet via the backup router(through Secondary ISP) thanks to the interface tracking functionality in HSRP.
To answer your 2nd question:
Yes, you can consider interface tracking as part of the 'Normal' HSRP.
For more information: try http://www.cisco.com/en/US/tech/tk648/tk362/technologies_tech_note09186a0080094a91.shtml#intracking