Kind of figured that is what may have happened. Usually, the one with their pants down is the one who had the idea. Kids don't easy drop their pants on a bus (or anywhere) unless it is their idea.
Hopefully, the parents of the other child were informed - because something is going on there.
Actually he said that the other boy asked him to do that, I talked to him and told him this is our private parts we keep it for ourselves we don't show it to other people and we can't see the others, I asked him if someone else did it to him or asked him to do it but he said no, I told him I thought we r friends and as a friend u should've told me ur self not to wait to the teacher to do
Well, if that many people know about it. Then I think he is going to feel pretty bad about the whole thing. Of course, what you do is to tell him that what he did is not acceptable and don't do it again. But, you need to go one step beyond that. 7 year olds don't just come up with this idea on their own. Someone else has probably done this with him and taught this to him. This should be your real concern.
Kind of weird to happen on a school bus. Who caught him? How did you find out?