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 Cotton was placed on half-pay, but continued in India, where he was serving as aide-de-camp to Major-general Hare at Bangalore. In 1822 he purchased a company—his only purchased step—in the 3rd Buffs, then in New South Wales, and after its removal to India served as aide-de-camp, and for a time as military secretary, to his kinsman, Lord Combermere, commander-in-chief in India. In 1828 he was appointed to a majority in the 41st in Burmah, and subsequently exchanged to the 28th in New South Wales. He became a brevet lieutenant-colonel 23 Nov. 1841, and about the same time was despatched from headquarters, Paramatta, in charge of five hundred male and female convicts, to re-form an old station at Moreton Bay, on the east coast. The district was declared open to settlement soon afterwards, and is now the colony of Queensland. Cotton accompanied the 28th to Bombay, whither it was sent on the news of the disasters in the Khyber Pass, but the virulence with which cholera attacked the regiment on arrival and clung to it prevented its taking the field, although it was so employed for a while under Sir Charles Napier in Scinde, when the ameer threatened a renewal of hostilities a year later. Cotton became regimental lieutenant-colonel 8 June 1843, and when the 28th was ordered home in 1848 effected an exchange with Colonel, afterwards Sir John, Pennefather to the 22nd foot, with which he remained in India. He commanded a combined force of the three arms sent as a reinforcement to the north-west frontier in 1853, during the agitation consequent on the murder of the British commissioner, Colonel Mackesay, at Peshawur, and proceeded with it to the Kohat Pass, where he brought the refractory tribes into submission. The same year he commanded the 22nd with a force under Brigadier Boileau, employed against the Boree Afredees, and in 1854 was despatched with a force of 4,500 men to punish the Momund tribes at Shah Mooseh Khef. He became brevet-colonel 20 June 1854, and when the 22nd foot went home he exchanged to the 10th foot in Bengal. At the outbreak of the Sepoy mutiny Cotton was commanding in the Peshawur valley as first-class brigadier. Of moderate stature and spare active form, his forty-seven years of military service sat lightly on him, and he was known to be one of the best regimental officers in the service. His previous Indian experience may be summed up in his own words: He served in the Madras presidency many years, and in Burmah for a time; in the Bombay presidency many years, and in Scinde for a time; in the Bengal presidency, at two periods of his life, for a vast number of years; and at almost every station in the three presidencies where European troops were located. He served in a light cavalry regiment in the Carnatic and Mysore for over ten years, and in command of a squadron in the ceded districts during the Pindarree war of 1816–17; on the staff of a general officer at Bangalore for two years; in command of a station near Madras; as deputy adjutant-general and deputy quartermaster-general of the royal forces in Madras; as aide-de-camp to the commander-in-chief in India, and military secretary. He served under Sir Charles Napier in Scinde, and commanded a field-brigade at Deesa in the Bombay presidency, and brigades at Umballa, Rawul Pindi, and Peshawur in the Bengal command (, Nine Years on the N.-W. Frontier, preface). The outbreak of the mutiny furnished the opportunity for testing his fitness for higher military command which had hitherto been wanting, and the annals of the north-west frontier during that most anxious time bear record that he was equal to the occasion (, Hist. Sepoy Mutiny, ii. 453 et seq.) He was, as Lord Lawrence pronounced him to be, the right man for the place (Life of Lawrence, i. 463). When the worst was over, Cotton was despatched to Sittana, in command of an expeditionary force, with the late Sir Herbert Edwardes as political agent, to root out a colony of Hindustani fanatics and rebel sepoys, who had established themselves over the Eusofzie border, a service performed with great judgment and success, the offenders being punished without rousing the hostility of the adjacent tribes. For his frontier services Cotton was made K.C.B. He became major-general 26 Oct. 1858, and was appointed colonel of his old regiment, the 10th foot, on 5 Feb. 1863. For some years he commanded the north-western district with headquarters at Manchester. He became lieutenant-general 20 April 1866; was appointed honorary colonel of the 1st Cheshire Rifle Volunteers in 1869; was made governor of Chelsea Hospital, in succession to Sir John Pennefather, 10 May 1872; and G.C.B. 24 May 1873. He died 20 Feb. 1874.

Cotton married Marianne, daughter of Captain Halkett, late 22nd dragoons, and by that lady, who died in 1854, was father of Colonel Lynch Stapleton Cotton.

Cotton was author of the following works: 1. ‘Remarks on Drill, with rough sketches of Field-days and Diagrams’ (Calcutta, 1857). 2. ‘The Central Asian Question; a prophecy fulfilled’ (pamphlet, 16 pp. Dublin, 1869). 3. ‘Nine Years on the North-West Frontier, from 1854 to 1863’ (London, 1868, 8vo). In the latter, together with a narrative of events preceding and during the mutiny, the writer