The original question related to a UK registered aircraft on a private flight and so all references to FARs, CASA, EU-Ops, MELs, etc. are entirely irrelevant.
Assuming that the helicopter is an EASA aircraft (as defined by CAP 747 and the Basic Regulation) and holds a Certificate of Airworthiness, for the C of A to remain valid the required equipment, as defined by the relevant EASA Certification Standard, must remain serviceable. In the case of the S300CBi, the relevant standard is CS-27 and paragraph 27.1305(d) requires a fuel quantity indicator to be provided for each fuel tank. Furthermore, CS27.1301 requires that each item of required equipment must function properly when installed.
Consequently, if the fuel gauge, being a required item of equipment, does not function properly, the Certificate of Airworthiness is not valid and Article 16(1) of the ANO 2007 prevents the aircraft from being flown.
Enough references for you, thecontroller?