Mercedes-Benz ML350 CDI is a locally assembled car, it comes as CKD (Completely Knocked Down) kit and Mercedes_benz assembles this car in India. And if a car has been imported, the taxes will be imposed by excise department not by RTO.
Both Mercedes ML 350 and Audi Q7 are very good SUVs. However, Audi Q7 is more powerful and feature rich, so you should go for the Q7. We will also advise you to test drive both the vehicles before making any decision.