You have to physically read the port so the IOC interrupt can latch.
C:
void interrupt interupt(void)
{
unsigned char dummy;
setRELAY(1);
LED(1);
__delay_ms(300);
setRELAY(0);
LED(0);
Interrupt_occured = 1;
dummy = PORTA;
RAIF= 0; // clear flag
GIE = 1; // enable global interrupts