All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad, sallallaahu ‘alayhi wa sallam, is His slave and Messenger.
{But if you return [to sin], We will return [to punishment].}:
This is a promise from Allaah Almighty to punish the children of Israel if they returned to sin and corruption.
{It is expected, [if you repent], that your Lord will have mercy upon you.}:
This is a promise from Allaah Almighty to bestow His Mercy upon the children of Israel again after what He Has Afflicted upon them in the latter time that is referred to in the Aayah. Allaah Almighty Fulfilled His promise and their number increased until some of them became kings. However, they returned to corruption by disbelieving in the Prophet, Sallallaahu 'alayhi wa sallam. Hence, Allaah Almighty Humiliated them again as He Had Promised.
Imam Al-Qurtubi said:
{It is expected, [if you repent], that your Lord will have mercy upon you.}: This is what they have been told in their Book (Torah) and it is a Divine promise to Remove their subjugation that will be inevitably fulfilled until some of them would became kings.
{But if you return [to sin], We will return [to punishment].}: Qataadah said: "They returned to sin, so, that Allaah Almighty sent Muhammad, Sallallaahu 'alayhi wa sallam, who made them meekly pay the Jizyah."
Al-Baydhaawy said:
"{It is expected, [if you repent], that your Lord will have mercy upon you,} after the latter time, {But if you return [to sin],} again {We will return [to punishment],} for a third time. They already returned after the latter time through disbelieving in the Prophet so Allaah, the Exalted, Punished them again by giving the Prophet, sallallaahu ‘alayhi wa sallam, the authority over them (after they broke their covenant with him). Hence, he killed the Jews of Quraythah, expelled the Jews of Banu An-Nadheer and imposed Jizyah upon the others."
Thereupon, it is clear that the promise of Allaah to have mercy upon them is conditioned by refraining from returning to corruption and sins.
However, their disbelief in Muhammad, sallallaahu 'alayhi wa sallam, is one of the greatest forms of corruption. Consequently, Allaah Almighty will not have mercy upon them, while they commit such corruption.
Nevertheless, Allaah, the Exalted, May Tempt them, by empowering them, in accordance with His norm with the oppressors.
The Prophet, Sallallaahu 'alayhi wa sallam, said, "Verily, Allaah Gives respite to the oppressor. But when He seizes him, He does not let him escape.'' [Narrated by Al-Bukhari and Muslim; this is the wording of Al-Bukhari]