Surah 2:256 claims that there must be no compulsion in religion, yet Surah 8:38-39 commands Muslims to fight until all religion but Islam is done away with.
8:38 Tell those who disbelieved: if they stop, all their past will be forgiven. But if they return, they will incur the same fate as their previous counterparts.
8:39 You shall fight them to ward off oppression, and to practice your religion devoted to GOD alone. If they refrain from aggression, then GOD is fully Seer of everything they do.
Again, Quran establishes the general rule that there is NO COMPULSION in religion. Fighting is allowed ONLY in fitnah or self defense or fighting oppression or injustice but not for aggression or spread of religion. God in the Quran wants the believers to have tolerance to the disbelievers who are not fighting them, oppressing them, persecuting them,or fighting their religion. To forgive and live with the followers of other religions is the spirit of Islam (submission).
2:256 There shall be no compulsion in religion: the right way is now distinct from the wrong way. ...
60:8.2 GOD does not enjoin you from befriending those who do not fight you because of religion, and do not evict you from your homes. You may befriend them and be equitable towards them. GOD loves the equitable.
It is clear from the above verses that 8:39 is one of these situations where there is oppression, and the verse ends by call for peace if aggression of the disbelievers stop. A perfect example of a most civilized law. Praise be to God.