Hart has made a number of high profile errors this season and has been replaced between the sticks at the Etihad by Costel Pantilimon in recent games.
Pantilmon is expected to start away at Sunderland this afternoon but Hart remains England number one ahead of two friendlies next week.
Schmeichel was not surprised that Hart was dropped but completely disagrees with how the talented stopper has been treated.
“I disagree with Pellegrini’s decision. I disagree with the whole debate about Joe Hart,” Schmeichel said.
“He might have had the odd situation, but he hasn’t gone from being an absolutely brilliant keeper to what he is being portrayed as now.
“Why is it that when you finally have an English goalkeeper who has the quality to become the first part of the spine that can actually take England somewhere, everyone wants to drag this kid down?
“You have a unique goalkeeper here, someone who is very, very good even on his bad days.”