这个句子中的it不是多余的。which引导定语从句并在从句中作to have的宾语。it是定语从句的主语，指代上文提到的一件事。to augment or diminish不定式短语是主语的第二个定语。have和to do不定式不是情态结构。have是及物动词。

Sb mean A by B. 某人说B，指的是A。 A is meant by B: A的意思是B。

By the principal of utility is meant the principle which  it appears to have to augment or diminish the happiness of the party whose interest is in question.

By the principal of utility：方式状语

is meant:被动语态谓语

the principle:主语

which  it appears to have：定语从句修饰主语

to augment or diminish the happiness of the party whose interest is in question:不定式短语为主语的第二个定语，表示同位关系。其中：

which：宾语

it:主语

appears to have:谓语

to augment or diminish the happiness of the party whose interest is in question：目的状语。其中whose interest is in question为定语从句，修饰the party.

译文：

功利性原则指的是它（上文提及的事情）似乎所具有的增加或减少利益相关者的快乐程度的原则。

举一个类似的例句。

This is the plan which we have to rebuild the bridge. 句中的we相当于上句中的it。