Police had advance warning of a planned IRA operation which ended with two gunmen being shot dead by the SAS, an inquest has heard.
But the officer in charge of the military surveillance near Loughgall in Co Armagh denied there was a shoot-to-kill policy at the time.
Martin McCaughey, 23, and Dessie Grew, 37, died in a hail of bullets near farm outbuildings that troops believed contained a vehicle to be used for terrorism, Soldier K said.
An inquest into the October 1990 killings was held on Tuesday in Belfast. Soldier K said his men opened fire only if life was endangered.
"My understanding of what some people might think a shoot-to-kill policy is is that personnel, military personnel, set out to go on to the ground with the specific objective of shooting to kill terrorists at any opportunity when they see them," he said.
"That is not my policy, it was not the policy of the armed forces in Northern Ireland."
The soldiers were observing a vehicle they believed was intended to be used for terrorist activity, Soldier K added. He said using a camera instead would have been a crude option, difficult to disguise, and it was better to have humans with a view of the scene to control it, the Press Association reported.
RUC intelligence said that the Provisional IRA had an operation planned in Armagh between 8 and 9 October, lawyer for the families Karen Quinlivan said. Grew was identified as being in charge. Military intelligence did not specify when or where terrorist activity would take place, Soldier K told the inquest.
Ms Quinlivan questioned the soldier about why troops had fired 72 shots. Autopsy reports showed Grew sustained 48 wounds while McCaughey was hit by 10 bullets.
"Soldiers (were) firing at close range against a man on the ground (McCaughey), causing his death," Ms Quinlivan said, asking what threat could have been posed by an injured man lying on his back. She said two rounds were also fired at Grew while he was lying wounded on the ground.
Soldier K responded that bullets which aimed to disable were confined to the movies.
"In my experience, in the context of a life-threatening situation... when people`s adrenaline is pumping, actions and activities can be extremely confusing," he said.
"When your life is threatened you will take action to ensure that person no longer presents a threat to you."
He added that ascertaining whether that person was a threat would mean assessing whether he could still use his weapon.
Soldier K said the Army was there to provide reassurance, deterrent and attrition.
However, documents provided by the Ministry of Defence to the inquest outlined that soldiers were aware that part of their role was to kill or capture terrorists.
Ms Quinlivan put it to the soldier, officer commanding in charge of special forces in Northern Ireland from 1989 to 1991, that the attack had appeared like an ambush.
Advice from the-then head of the Army in Northern Ireland, Sir John Waters, sent for distribution to all soldiers before deployment to Northern Ireland, compared operations generally to a tiger hunt and killing or capturing using guns.
He also addressed public perceptions of the conflict and the "morbid" focus on the number of casualties.
Another senior officer expressed concern that the general`s comments could be misconstrued and advised change of language.
Soldier K said: "All the training that I have done is that the requirement for caution is always emphasised and the use of lethal force is a last resort.
"No one likes using lethal force."
The soldier said his men did not deliberately withhold information from police investigators after the killing but may not have volunteered it unless asked for it.
Informal notes of verbal briefings may have been taken but the "tempo" of activity in Northern Ireland at the time limited what instructions could be put down in writing.
The inquest continues.