A spokesperson for the Care Inspectorate said: "The Care Inspectorate initiated court proceedings seeking the cancellation of the registration of the care provider at Home Farm care home in May.
"We did this following an inspection which raised serious concerns.
"We have monitored the home carefully and we are satisfied that there has been considerable improvement in the quality of care experienced by residents and the issues that were putting them at serious risk have been addressed.
"In light of this we have decided to no longer pursue the cancellation of the service's registration through the courts."