There being no commission vacant on his arrival, he was first placed in the ‘select picket,’ a military body composed of the cadets then present at Calcutta.
In 1782 he accompanied Colonel Pearce's detachment, sent to join Sir Eyre Coote (1726–1783), then engaged against Haider Ali and his French allies in the Carnatic, and in 1783 he commanded the English artillery in the siege unsuccessfully attempted by General James Stuart of Cuddalore, a strong Carnatic fortress then held by the French.
For his skill and vigour Montagu received special commendation from Lord Cornwallis.
On 1 March 1794 Montagu was made lieutenant-colonel, being now third on the list of Bengal artillery officers.
On 2 May Montagu, while directing his battery, was struck in the shoulder by a cannon-shot from the enemy's lines.