There are two possible cases.
Case I:Five 1's one 2's one 3's
Number of numbers =$\large\frac{7!}{5!}$
$\Rightarrow \large\frac{7\times 6\times 5!}{5!}$$=42$
Case II: Four 1's three 2's
Number of numbers =$\large\frac{7!}{4!3!}$
$\Rightarrow \large\frac{7\times 6\times 5\times 4!}{4!\times 3\times 2}$$=35$
Total number of numbers =42+35=77
Hence (C) is the correct answer.