If it has passed its MOT then that basically means it is legally roadworthy.
However, remember any vehicle can become unroadworthy the moment it leaves the testing station. Also if stopped by the police or Dept of Transport official, they may use their own plateau of law and discretion. An MOT will actually mean diddly squat in this case.
I know this has be stated especially with noise. An officer, for example, can fix-penalty you if the vehicle is emitting unnecessary noise (i.e exhaust, engine block or even a loud car stereo).
As the whole of the exhaust can be seen on a bike, can you simply not remove the sign, or file it away?