This is the Chinese narrative about what happened to the USS Connecticut submarine. They disagree with the United States. Who said that it collided into an undersea mountain. Instead they say that they damaged it intentionally to prevent the nuclear reactor from irradiating the Chinese shoreline.
Yeah, this is a major incident regardless of whether PLA actually intercepted the sub or it ended up having issues on its own. My guess would be that US was probing Chinese capability and got a nasty surprise. It’s likely that PLA is now able to efficiently track US subs in South China sea. There’s also this video that appears to collaborate the article.