The 12-year-old, who cannot be identified, was among four other teenagers charged over the assault and death of Mr Truong in August.
He faced accusations of violent disorder, affray, and intentionally causing serious injury. The group allegedly attacked Mr Truong after the grocer intervened during an alleged teen assault.
On Thursday, prosecutors informed the children's court they would withdraw all charges against the boy. His lawyer had previously argued that his young age meant he may not have understood his actions were seriously wrong. The magistrate confirmed the withdrawal, stating: "The charges are withdrawn."
The doli incapax principle places a high evidentiary bar on prosecutors in cases involving children under 14. The Director of Public Prosecutions determined this standard could not be met for the 12-year-old. The outcome has no bearing on the charges still faced by the other teenagers involved.