The answer is basically yes, but I've seen people get crossed up by this before when more than 1 player is substituted into the same serving position. So to modify your question slightly, "if #7 subs for #1, #1 can only re-enter for #7 or a player who was substituted in the same serving position as #7."
For example, #1 starts the set and #7 replaces for #1. Then later in the set #12 replaces #7. Later on #1 could replace #12.