I tried with 220nF at input & 100nF at output of 78L05. Changed the config a little to try this code on 12F635 which I happen to have quiet a lot. This way I can save few 12C671. The circuit remains the same.

_PWRTE_ON or OFF is not making any difference.

The problem is stuck on GP4 now. GP 0,1,2,3 are working fine.