"ON INTERRUPT GOTO" Checks the interrupt flag after each major instruction. My guess is that it is "blind" during the PULSOUT command. If you want PORTB.1 to go high, and stay high whenever there is AC present. This won't do it.

I would use DT-INTS to handle this. Since DT-INTS has an ASM "core", no PBP command can block it.