if failure occurred at some point and lets say Flink took 1 min to recover from that than what would happen to data streamed within that 1 min, does Flink keep track of how much is data streamed?

It depends if your connectors have fault-tolerance (at least once, exactly once etc) support and if you have enabled checkpointing. If that's the case, Flink would just resume with reading where it stopped before the failure

public static void main(String[] args) throws Exception {
        StreamExecutionEnvironment env = StreamExecutionEnvironment.getExecutionEnvironment();

        env.enableCheckpointing(10000, CheckpointingMode.EXACTLY_ONCE);

        env.getCheckpointConfig().setMinPauseBetweenCheckpoints(1000);

        env.getCheckpointConfig().setExternalizedCheckpointCleanup(ExternalizedCheckpointCleanup.RETAIN_ON_CANCELLATION);

        EmbeddedRocksDBStateBackend stateBackend = new EmbeddedRocksDBStateBackend(true);
        stateBackend.setPredefinedOptions(PredefinedOptions.FLASH_SSD_OPTIMIZED);
        env.setStateBackend(stateBackend);

        env.getCheckpointConfig().setCheckpointStorage("<hdfs://127.0.0.1:9000/flink/checkpoints>");

        env.setRestartStrategy(RestartStrategies.fixedDelayRestart(
                5,
                org.apache.flink.api.common.time.Time.of(10, TimeUnit.SECONDS))
        );

        KafkaSource<String> source = KafkaSource.<String>builder()
                .setBootstrapServers("127.0.0.1:9092")
                .setTopics("status")
                .setStartingOffsets(OffsetsInitializer.earliest())
                .setValueOnlyDeserializer(new SimpleStringSchema())
                .setBounded(OffsetsInitializer.latest()) // tells flink to stop at latest offset
                .build();
}

I have this much setup done, so this would recover if any failure occured