Tough love should be used in situations where either the person has a serious problem and needs help (i.e, drug abuse, addiction) or if they have done something wrong and are aware of it (i.e, robbed a bank, instigated a fight).
You should use tough love for someone who you care about, such as family, or anyone that you are worried about and don't want anything bad to happen to.
I don't believe that love must be incorporated into every situation, but rather that you must have the determination to help the person.
I use tough love on one of my baby sisters, who is pretty spoiled, and needs to learn that life won't give her everything that she asks for. Basically, if she acts like a brat and starts screaming for something, I won't give it to her. If she asks nicely, and it is a reasonable request, she can have what she wants. This is tough love because I'm doing it to help her, and prepare her for the disappointments in life.
I do believe that people should use tough love, and be assertive when it comes to certain things. Being too nice to people isn't what they always need, so when it comes down to helping them, tough love is sometimes the only solution. :)