Story of Ganesha drinking sea of honey happened during the war between Tripurasura and Shiva. Tripurasura and his brother revolved around the universe in three flying cities and unleashed a reign of terror. All the gods and goddesses prayed to Ganesha for the success of Shiva.
But one day, the war between Shiva and the demons began without the Devas taking the blessings of Ganapathi. On the day, Shiva was unable to achieve any kind of victory. When Shiva came to know that his arrows failed due Ganapathi, he aimed an arrow at Ganesha.
The arrow could not wound Ganesha but it could neither go waste. So Ganesha directed the arrow towards the sea of Honey, one of the seven sacred seas in Hindu scriptures. Before the arrow could hit the sea of honey (Madhu Sagara), Ganesha drained the ocean floor by drinking up the honey.
It is said that all the honey gave discomfort to Ganesha and he appeared at the Guddattu region in Udupi and entered the Narasimha teertha. He remained in the water till the effect of honey disappeared.