Hi kishore177,
From the moment you update to iOS 14.6 it will be supported for iPhone 7.
I attached some screenshots to this post, the one with the white background is for on your iPhone. Then there are screenshots with a black background for more clarification.
On your Mac when you open preferences ( Command + , ) in the Music application, you will see this screen when opened (screenshot with '1' on in red/white). Make sure to toggle the option, selected in green, on. Secondly click on the icon thats surrounded by an orange square, you will see a screen like the one where is '2' on in red/white. Make sure that you turned Dolby Atmos on (see the option in the blue square, select there "automatic" or "always on"). The options in the purple box is optional if you want the best out of your AirPods Pro, Lossless Audio won't work with the AirPods Pro but it will send the highest quality to them.
I hope this helps. if you have any other questions, be free to ask/post.
Kind regards
Ruben