1998 ML 320 Air filter (MANN)

Just got the MANN air filter (C30 195/2) from FastLane to replace the old filter (Mercedez brand). When I pull the old filter out, I found it to be different from the MANN filter. Where it differs is that 1/3 portion of the MANN filter is about 1/2 of the height of the other 2/3 portion. I asked Phil at Fastlane whether if the 1/2 height portion should be installed facing inward (toward the passenger) or outward (facing the bumper). He does not know.

Does anyone know why this MANN filter differs from the original Mercedez filter? More importantly, should the half height portion face inward (toward the passenger) or face outward (toward the bumper)?

Thanks in advance for any help!

DCheng