You have not made the situation clear - if it has been converted from a five seater, it will need an engineering certificate. If it has always been a seven seater, yes, this will need to be corrected - the compliance plate should have the number of seats on it. 
Having the wrong number of seats on the registration could (but unlikely) lead to prosecution if you carry more than five, or even just having the seats, and also could lead to insurance issues.
You need to talk to RMS about the current procedure to correct it. I went through the same circus with my County many years ago, and this involved two trips into town, one to an RTA inspection station. Since the error was made by one of their own when the vehicle was transferred from Victoria, I sent them an invoice for the mileage and my time, and much to my surprise, they paid it.
				
			 
			
		 
			
				
			
			
				John
JDNSW
1986 110 County 3.9 diesel
1970 2a 109 2.25 petrol
			
			
		 
	
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