IN/EXISTS predicate sub-queries can only be used in a Filter:

import sparkSession.implicits._

Seq("france").toDF("country").createOrReplaceTempView("countries")
Seq(("user1", "france"), ("user2", "italy"), ("user2", "usa"))
  .toDF("user", "country").createOrReplaceTempView("users")

val query =
  s"""
     |SELECT
     |  CASE
     |    WHEN u.country = 'italy' THEN 'Italy'
     |    ELSE (
     |      CASE
     |        WHEN u.country = c.country THEN upper(u.country)
     |        ELSE u.country
     |      END
     |    ) END AS country
     |FROM users u
     |LEFT JOIN countries c
     |  ON u.country = c.country
  """.stripMargin
sparkSession.sql(query).show()