<p>In AJAX applications that need to poll the server in regular intervals (like a chat applications), what is the recommended minimum time between two calls, so that the update is done as quickly as possible? What times are considered as hogs for the server and the client?</p>

The answer to this question is very much dependent on:
How much data is sent in each poll
How many users you will have online at a time
How much bandwidth your server can handle
How "fresh" the data on your client needs to be
Without knowing any of these specifics for your app, it's going to be hard to give a good recommendation. Have you looked into a method where the client connects to the server, and the server holds the connection open until there is data available? Then the server delivers the data, and the client immediately reconnects and waits again. That can be tricky to get working, but you might be able to maximize both efficiency of bandwidth AND responsiveness that way.