This is a project I am working on for two weeks. Now all of a sudden the global Input Echo button (the one in control bar) is permanently switched on and it does not go off, also my guitar goes audible through midi track. I hoped that if I save project under new name it will go back to normal but no. Anybody seen that before?

Although I haven't seen this behavior before,  have you tried to copy your information into a new project?
 
Make sure that Sonar is set (in preferences) to open more than one project at a time.
Then open and set up a new project (exactly like the one that's having problems).
Copy your audio/midi tracks over to new project and save as...
See if that helps.

Thanks, the projects runs more or less. I just wonder how on earth its possible to hear audio inputs through a MIDI track ?

Afrodrum
also my guitar goes audible through midi track.

Could you describe in a bit more detail what you mean by this ?
 
There's a Preference under MIDI / Playback and Recording : "Always Echo Current Midi Track".  It doesn't look like it has any effect on the Gobal echo button, but it might toggle something internally and get things back to normal.
 
Have you tried just "Save Copy As", exited Sonar, and tried the copy ?
 

Guitar lead into audiointerface input, echo is off on all audio tracks, when I strum guitar the audio signal goes to master through a midi track, meters on midi tracks are moving.

I just deleted the suspicious midi track. All back to normal including global echo which I can now toggle on/off.

Interesting.  did you copy the Midi information to another track or just delete it all (kit and caboodle)?

Yes, I moved midi clips to another track, then deleted the infected one (it had Sample Tank 3 btw). Interesting, how can you infect a midi to play audio ?   

Was it an instrument track, or did you have separate MIDI and instrument tracks in the same folder?

Anderton
Was it an instrument track, or did you have separate MIDI and instrument tracks in the same folder?

It was one  simple midi track created with SampleTank 3, it played nicely a midi file I created, then all a sudden synth went silent, global echo stucked on, and I hear (and see) my guitar going through it, both with track echo on and off. I will not be able to repeat it, I guess.