What happens to current transducer if the line it is attached to short circuits?
That current transformer is isolated from the line. Nothing will happen to the sensor, ADC, or MCU. The AC line never connects directly to that sensor anywhere. The sensor just goes around a wire carrying AC current.

The one hazard is that you should NEVER run a current transformer without a load (a burden resistor) or else an extremely high voltage will develop across the output terminals. This sensor looks like it already incorporates one though (the "so-called built-in sampling resistor").