The phrase truth be known is an idiom that is:
used to tell somebody the true facts about a situation, especially when these are not known by other people.
So your sentence could be rewritten as:
- because to tell you the truth, he did not dare take him on directly.
On the other hand, if the truth is known is not an idiom, and literally means what it says. An example of this usage would be:
Don't tell anyone what happened last summer, because if the truth is known, we're all going to get into serious trouble.
To emphasize the difference, here's a sentence using both phrases:
If the truth is known, we're going to be arrested, and if the truth be known, I'm scared of going to jail.
Which can be rewritten as:
If people find out, we're going to be arrested, and in all honesty, I'm scared of going to jail.
As you can see, the meanings of the two phrases are quite different.