i have a 1996 E36 body with a M44 engine and I don't have that on mine. It looks to me like its maybe the cabin air filter, mine has the diagnostic hook up module there. it's either the cabin air or kinda looks like it hooks up to the carbon canister. Go to a parts house and buy a book on your car it will tell you for sure.
If you told us the motor style it would be easir, E36 is the body.