That's the signal line to the air recirculation valve. MB feels that there are some situations in which it's appropriate to leak boost from the compressor outlet back to the compressor inlet.

I don't know where the signal comes from in an SD but if you're going to leave it disconnected, check the inside of the ARV to make sure the plunger seals properly against the compressor housing port. Otherwise boost will leak and you'll rob yourself of power that's duly yours.

Sixto
95 S420
87 300SDL