"The application (of Khatta Singh) has been dismissed by the CBI court today," said his counsel Navkiran Singh, adding that he was yet to receive a copy of the judgment.
The special CBI court is hearing two murder cases - of journalist Ram Chander Chhatrapati and former Dera manager Ranjit Singh. Khatta Singh is a witness in both the cases.
Ram Rahim Singh has been named a conspirator in the cases and is serving a 20-year sentence in two other rape cases.
Khatta Singh had moved an application in the court on September 16 to testify against the Dera head. The defence counsel in the case had opposed the plea.
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He had given his statement against Ram Rahim Singh in 2007, but he retracted it five years later, citing pressure from Ram Rahim Singh and his "goons".
Ranjit Singh was shot dead in July 2002. He was killed for his suspected role in circulating an anonymous letter that alleged sexual exploitation of disciples by the Dera head at his Sirsa headquarters, according to the prosecution.