The selectors, led by former West Indies captain Clive Lloyd, left out 40-year-old Chanderpaul from the 12-member squad for the first Test against Australia, citing lack of form of the left-handed batsman over his last 11 innings, in which he averaged only 16.
But Lara feels the decision was just another example of the way the WICB disrespects its players.
"In fact, he should be allowed to do it in his own way," Lara was quoted as saying by 'Trinidad and Tobago Guardian'.
The snub effectively means the end of Chanderpaul's illustrious career, in which the talented cricketer has scored 11,867 runs at an average of 51.37.
"In that way, there will be no hostility and whether he makes a double century or a duck, it doesn't matter, it will be his farewell series and the entire cricketing world will know that," the former West Indies skipper said.
"He deserves it. The WICB and the Caribbean owe it to Shiv to send him off with dignity and respect. He has earned it," he insisted.