Upgrade to 3.06
Damine, by Portal you mean CloudPortal Business Manager 1.4. Is that right?
If yes, we released new version of CloudPlatform (CloudStack) 3.0.6 but there was nothing new for CloudPortal Business Manager. So there is no really question about order of upgrade those two components.
>The main thing I want to know is the order in which to upgrade and will the VM's need to have some down time.
Depends what version of XS do you have now? But in general it should be possible to use upgrade scenario without downtime for VM, you may need to migrate them from XS server to another.