I actually just expanded it and got the answer: $840$.
But I am pretty sure that there`s some binomial (tri-nomial?) expansion involved here that can lead to the answer much more efficiently.
I did try to expand the binomial using the theorem and picked the $x^6$ term, and then expand the trinomial, but it became a mess because getting $y^3.x^6$ seems to involve more than just one term from the $(1+x)^7$.
All in all, can anyone shed any light on this?
$$[y^3] (1+x+y)^5 (1+x)^7 = [y^3](z+y)^5 z^7= {5 \choose 3} z^9.$$ Then the required co-efficient of $x^6 y^3~ in~ (1+x+y)^5 (1+x)^7$ is $${5 \choose 3}[x^6](1+x)^9= {5 \choose 3} {9 \choose 6}.$$