hi @soumil0702
You have a set of questions here that may need a combined response. Let’s see if I can make some sense of stuff for you.
Kind of, maybe 
- the iPad can use the on-board mic, but that doesn’t sound so good. You can use any audio interface with a USB (see here for mine). Keith mentioned this in his response, but I am giving you some real examples in the link (another forum question response).
If you want to play through the iPad and listen via bluetooth headset - just don’t. The latency in Bluetooth is annoyingly high. A great deal of this is because the Bluetooth standard is based on low power that is unreliable and sound is buffered on the playback device because dropouts are expected, so that means there is a delay for the size of the buffer. Many buffers are around 1/4 to 1/2 second and that is really too much to play and listen with comfort.
If you are just trying to play and capture with the iPad (and NOT listen while you play), then the links for hardware I have above are the sort of thing you can use.
Personally, when I use Garage Band, I play through a 1/4 inch to USB interface, and listen with my wired headset on a laptop. I do not suffer the bluetooth latency in the headset that way. I find the Garage Band interface a bit confusing, but I can eventually get what I am after and it does sound good. I take this with me out in the back yard on a nice day and it works well - just a laptop, guitar, headphones, and 1/4 inch to USB interface. I can carry all this in one trip.
I have done little recording this way, but I see how to do it and it looks like it should be easy to figure out.
If you are looking at some dedicated software specifically for guitar recording and effects, then I suggest you start doing a search on the forums here. There have been a lot of questions and responses related to that. Narrow down your question and we can help better.