We think to upgrade CREO version from 5.0.4.0 to 7.0.0.0.

While it may work, it is NOT supported.  Sorry.

 https://www.ptc.com/en/support/refdoc/creo_view/5.1/creowindchillcompatiblityroadmap

Creo 7 introduces multi-body part files and that has required changes to Windchill to support them.

I am in the process of upgrading Windchill to 11.1 m020 cps14 just for that reason.