Police told Additional District and Sessions Judge Lahore Rafaqat Ali that Mohammad Musa's name had been struck off from the FIR.
A police official said the nomination of Musa in the case of attacking police and gas company officials here was a "human error".
The court issued a show cause notice to a policeman for implicating the minor in the FIR.
The judge during the last hearing had granted interim bail to the minor till April 12 and directed the police to "record his statement".
After the local media raised the issue, senior police officials sought an apology and ordered striking off Musa's name from the case.
Sub-Inspector Kashif Ahmed, who registered the case against the toddler, had since been suspended.
The child's father said police had registered a fake case against him, his son and 25 others of his locality.
"Our crime is that we had protested against non-availability of electricity in our locality," he had said and urged authorities concerned to quash the FIR.
Counsel for the accused, Irfan Tarar, argued in the court that all those nominated in the case were innocent. He requested for a court order to quash the FIR against them.