It is believed the pair fell out over the proposed signing of veteran striker Jimmy Floyd Hasselbaink, who Mandaric wanted but Allen didn't.
Mandaric handed the former Brentford and MK Dons chief significant funds to strengthen the squad, but has called for fans to back his judgement after citing a "breakdown in the relationship" for Allen's departure.
"That was my decision to do it, but I do what is the best for the club," he insisted.
"It's not the games, it's not the results, it's looking at where I am going to be at the end of the season, not where I'm going to be after three games.
"When you want to go climb on the mountain, it doesn't mean you are always going to go with everyone that started the climb.
"There were certain differences about how to get to the top of the mountain."