
I am so sorry for your loss.
You do need to notify the breeder or pet store that he has passed. They may give you another chin.
What you are describing almost sounds like some one held him to tightly around the chest and broke a tiny rib that could have punctured the lung. When this happens, it usually takes 12 to 36 hours for the chin to die. Were there any x-rays taken? This would be the only way to know if this was the cause.
If he was sick or injured before you got him, morally, the seller should replace him with another chinchilla. Just my opinion.

Jo Ann