The tension is off. You could also have the wrong needle. Please try on fabric not paper. If you are sewing a straight stitch (not zig zag) it needs to be on 3 to 4. Post a picture of the machine and the model number.

How to make tension on, turn the bobin winder tension disc?

I tried on cloth, same result.

Need picture of machine. Cannot do anything without seeing machine.

Bobbin thread not properly engaged in bobbin case is my guess.

Is that the bobbin side? Usually means something is wrong with the way it is threaded. Rethread , start at the beginning, make sure the thread is in the tension discs, and make sure to thread the needle with the presser foot raised.

What is the model of the machine?

Search at Singer for a copy of the user manual - they have free downloads.

Do all the user maintenance they recommend: clean it, oil it, change the needle for a new one. Be VERY careful to put the needle in correctly, like the manual saya.

Then try the sewing test again, on cloth.

Until the machine is clean, oiled, and has a fresh needle it's useless to try to fic any stitching problems.

Do that, and come back for help if the problem is still there.

here is the picture.

Your thread is not in the guide at the top. The needle tension is usually set about 4. The needle position is usually in the middle for straight stitching and bobbin filling. The stitch length is usually shorter to fill the bobbin. I can't tell if the thread is in the tread guides over the top of the needle or not.Clean the dust out of the machine if any, check your needle, and refill the bobbin. Try on a scrap of cloth not paper. Look for your serial number and order the manual for your machine. Mine is not an electronic, so I don't know where it will be located.

http://www.singerco.com/support/machine-model-numbers

http://www.singerco.com/support/instruction-manuals

As stated above, you do not have the top threaded correctly. The machine has little arrows for you to follow from the spool to the needle. Be sure to have the foot raised while you follow the threading path.

Thanks everybody, I routed the thread proper way and got the result in photo. Sewing on top is perfect, on bottom there is a part which seems to be little lax but i think that is nothing. Right?

Perhaps

OK, I see it better now. Tape was covering part of the numbers in the first pic. : ).

You can move it to half points, too. Just play with different settings until it looks just right.

...or you can loosen the screw controlling the tension on the bobbin holder.