It's interesting chatting to people about the War in Iraq being "terrorism" according to Section 1 of the Terrorism Act 2000.
Some have a perception that terrorism and military action are conceptually miles apart.
The reality, of course, is that terrorism is violence for a political end and that military action is violence for a political end (but on a much larger scale, typically).
"Terrorism" and "military action" are simply two terms used to refer to the violence-with-political-aim part of the conceptual framework.
It's entirely to be expected that an Act of Parliament intended to deal with terrorism finds itself applying to military action too.
I suspect the parliamentary draftsman struggled with the affrontery of writing "Terrorism is violence-with-politics done by Them and is illegal. Military action is violence-with-politics done by Us (and we're the Good Guys) and is legal."
It would be pretty obvious that the concept of everyone being equal under the law had gone out the window.