Chelsea player John Terry arrives at Westminster Magistrates Court to stand trial for allegedly racially abusing Anton Ferdinand.
Cole said on Wednesday that the case should never have come to court.
Terry is accused of calling Queens Park Rangers defender Anton Ferdinand a "black [expletive]" in a racially-aggregated verbal attack during a match after being goaded over an alleged affair.
Terry lost the England captaincy for the first time in 2010 when allegations surfaced he had an affair with the ex-girlfriend of then England-teammate Wayne Bridge.
On the third day of his trial, Cole took to the stand to say he heard Ferdinand say "Bridgey," "black" and the expletive. But Cole, who is black, said he never heard Terry's response at Loftus Road and insisted that his teammate is not racist.
Cole backed Terry's defence that he repeated the offensive term to Ferdinand during the confrontation in October to counter what he believed the QPR player was accusing him of saying.
"If I repeated something that I thought you said, that's totally different than if someone just says something," Cole said.
'Crossed the line'
Dismissing the case as "handbags" – a British term for a minor scuffle – Cole completed his testimony in Court 1 at Westminster Magistrates' Court by saying: "I think we shouldn't be sitting here."
Prosecutors, though, have claimed it was "plainly and inherently unlikely" Terry would decide to repeat the phrase with no surprise or incredulity.
"You knew you had crossed the line and you have regretted it ever since," prosecutor Duncan Penny said. "You are stuck with this story since you put it out in the press and you can't back down."
Terry dismissed the notion.
Penny asked Terry why Ferdinand would have concocted a false accusation against the then-England captain.
"What good was it going to do him, making this allegation against you if it was not true?" Penny said.
Stripped of captaincy
"I can't answer any questions for Anton," Terry replied.
Giving evidence earlier on Wednesday, Terry insisted that he was immune to abuse about his private life and family during matches.
Terry said he has taken "abuse on the chin" since the allegations about the affair with Bridge's ex-girlfriend emerged in 2010 and led to him being stripped of the England captaincy for the first time.
Terry also recounted how he finds it "upsetting" that Liverpool fans bellow vulgar chants about his mother during matches.
The case centres on video evidence of the alleged incident that emerged on YouTube with subtitles quickly after the match. Ferdinand testified that he didn't hear the alleged abuse during the match and only became aware of it via the internet clips. – Sapa-AP