There is nothing special about flag='y'... it's text. It could be anything He's just aliasing the table.
The point is that by using square brackets you can alias something to even something crazy that looks like an expression.
--These are all the same...
Select * from [where] [flag ='y' ]
Select * from [where] [Beer]
Select [flag ='y' ].* from [where] [flag ='y' ]
Select [Beer].* from [where] [Beer]
Select table1.some_data from [where] table1