Not sure what is going on here. You have a sensor that you are powering from the step up converter, however you don't show how that sensor is fed back into the arduino.
Also you have the arduino powered off the battery, it won't run correctly like this according to the data sheet. First the clock is too fast and second the brownout might kick in.
However the circuit for controlling the step up looks right. If you short out the collector / emitter does the output go to 5V?