I'm not 100% sure on how to increase the PermSize and Google wasn't too helpful. I changed the PermSize in the server.bat to 256m but it still crashes. I downgraded my version of computercraft to 1.58 and this didn't have any effect. I have uploaded a .zip of my server. I have a fairly powerful computer so that is why I have included a lot of mods although I will do some testing to see if there is a specific mod that is the problem or if I just need to decrease the number of mods. Here is the file : https://www.dropbox.com/s/uoxwihaehjl4a0a/TestServer.zip
PS. I have dye trees because of the rainbow trees. They are super cool and while testing I found a pretty cool way to farm them. They drop tonnes of dyes and even golden apples. The dyes can be used by minefactory reloaded to make bio fuel and then pumped into a railcraft boiler to be converted into IC2, Thermal Expansion or buildcraft energy Thank you for taking the time to help my by the way, really appreciate it.