Denial

yes they can but you have many options to handle it though the most you can hope for is your item returned and possibly the customer service person may get reprimanded or fired if they have had previous complaints, as no matter what they have to be polite and helpful even if it is explaining why you are unable to return a product. 

here is a link to the store return policy so you can check and see if a valid reason for the refusal was legitimate http://walmartstores.com/7658.aspx

i would file a complaint with wm corporate Customer Service
1-800-Walmart (1-800-925-6278)

if you did not speak to a store manager i would also call the store and ask for the store manager give details of transaction and try to give employees name, (this call has been very affective for me in the past)

if you need to return item asap either have someone else try to return at a different time of day or go to a different store.