Ballack is currently recovering from ankle surgery and does not figure in his club's 23-man party for the group stages of the competition.
Chelsea insist they took the decision because they could not guarantee Ballack would be fit for the majority of their six group matches, suggesting he will not return until the end of October at the earliest.
"For us, Chelsea's decision is unfounded," said Low.
"At the moment, nobody can quite understand it."
According to Sport Bild magazine, Ballack was in Munich on Thursday undergoing further tests to clarify the extent of his injury with Germany and Bayern Munich team doctor Hans-Wilhelm Muller-Wohlfahrt.
It appears it is not only Low who finds the whole injury situation puzzling. The player himself is caught between pillar and post, according to the Germany coach.
Low said: "Michael cannot quite explain for himself why Chelsea have not nominated him for the Champions League."