Police claim he was found with the 70-cent chocolate frog, allegedly shoplifted by the child's friend from a Coles supermarket in the Wheatbelt town.

The boy, who has no prior convictions, also faces a second charge involving the receipt of a novelty sign from another store. The sign, which was also allegedly given to the boy by his friend, read: ''Do not enter, genius at work.''

In court today, the boy's lawyer, Peter Collins, said he would object to the original police interview with the boy - which was recorded - being used in court.

The boy was granted bail and will appear in court again on February 22.

Mr Collins, chief lawyer of the Aboriginal Legal Service in WA, had previously lobbied WA police for the charges to be withdrawn, but authorities had failed to respond to his request, he said.

''It's scandalous that a 12-year-old child should be subject to prosecution for a case of this type,'' he told The Age.

Mr Collins said that when the boy last month missed a court date due to a family misunderstanding, police had apprehended him about 8am on a school day and taken him into custody. The boy was then imprisoned for several hours in the holding cell at the police station.

''The conditions in those cells are appalling, and completely ill-equipped to hold young children,'' Mr Collins said.

He felt the boy could have been dealt with by way of caution, or referral to the juvenile justice team.

The case highlights the continuing overrepresentation of indigenous youth in juvenile justice systems across every state and territory.

Aboriginal and Torres Strait Islander youths aged 10 to 17 were nearly 30 times as likely to be in detention on an average day than other children nationally, according to data released this month by the Australian Institute of Health and Welfare. In WA, the figure is 45 times.

Chris Cunneen, a board member of the Australian Indigenous Law Reporter, said WA's juvenile justice system was bedevilled by high ratios of indigenous youth detention as well a high number of all youths going through the court system.

Leading children's rights campaigner John Fogarty, a retired Family Court judge, said: ''If this was a non-indigenous child, the most he would probably get in Victoria and most other jurisdictions, would be the mildest of warnings by the local sergeant.''

A WA police spokesman said police had spoken to the boy before and it was appropriate the court should now decide what should happen next.