Britain was involved in two low-intensity wars in South-East Asia after World War II: the Malayan Emergency (1948-1960) and the "Confrontation" with Indonesia over Sabah and Sarawak on the island of Borneo (1963-1965).

As McGrath of Harlow points out, heads were sometimes taken during the Malayan Emergency, but for identification purposes. It was much easier than carrying an entire enemy corpse through several miles of dense "ulu" (Malay word for jungle, still in use in the British Army thirty years later).

However, there were one or two genuine atrocities. These were not usually wanton cruelties. More often it was a case of civilians being killed or injured when young and inexperienced National Service Officers and OR's panicked and opened fire without cause. This was the conflict which spawned literature like Leslie Thomas's "The Virgin Soldiers". For the early years of the Emergency, the British Army was not properly trained or organised to fight elusive guerillas.

To the best of my knowledge, British forces committed no war crimes or atrocities against civilians during the Confrontation with Indonesia. As has been pointed out, they enjoyed the support of the bulk of the population, and were generally well-trained and prepared.

Both sides occasionally executed prisoners. It was impossible to take them along, especially if in enemy territory or if wounded, but fatal to let them go free to guide pursuers after their former captors.

I doubt whether Gurkhas ever went on patrol armed with nothing but a kukhri, but there are several cases on record where, rather than clear a jammed rifle or machine gun under fire, a Gurkha would drop it and charge with a kukhri. In the dense forest, the ranges at which ambushes or contacts took place were often short enough to allow this.