by installing powerful Varta alkaline cells but flashlight blinked couple of times and gone dead.
Yep. You definitely fried it there. I once had a cheap keychain flashlight that I didn't want so I hooked it up to 5V and it had exactly those symptoms. When I hooked it up again, it didn't work. No big deal, I just wanted to see what would happen, and I didn't really have a use for it.
However, if the person who designed that flashlight has greater than 0 electronic knowledge, they would add a resistor to limit the current. The only reason a resistor wouldn't limit the current correctly is if you had more voltage, which both more voltage and current allowed is a huge problem. Current is supplied on demand, but the LED sucks up as much as it can, but the resistor should limit it no matter the amount of current that can be supplied, unless the voltage is increased.
Edit: One thing I forgot: Quote from jippie's comment:
Alkaline batteries probably have much lower internal impedance than the original ones. The designer used the battery's internal impedance as series resistor. Done quite a lot in el Cheapo stuff.
Batteries have a internal resistance, and that's why the designer used the original ones to save on money. It's a smart trick, but you should have put a resistor in. How you would know this before, I don't know. But, if you have another one, you would just need to add a quick one from the store. At my RadioShack, I can get a five pack of 1/8W, 1/4W, or 1/2W for $1.49. (Yes they are all the same price... I have been wondering why anybody would want the more flimsy wires and a smaller piece that has less capacity but is the same price as the others.) But... you don't know how much current the LED can handle, unless you measured the current with the old batteries and used Ohm's Law.
If you have another and a multimeter, you can fix it on the other, but this one is toast. Gone. Bad. Broken. Fried.