Defensive stance grants an additional evasion reaction and causes incoming melee attacks to be made at a -20 penalty. The tradeoff for this is that you can't attack (I'm paraphrasing the rule while I wait until I have access to the rulebook). Counter Attack allows for a once per turn (notably not once per round, one per turn) attack made after a successful parry.
Can the two be used together, as far as I know, RAW, they can, but I'm seeking errata, statements from developers, and general public opinion on the matter, as the rules don't specifically address it.