As for physics, it is really very simple, the kinetic energy is converted to a potential energy while climbing and then to kinetic again when falling, with some of it converted to a heat due to friction. The air friction is quite substantial, the landing velocity, which is reported to be in range 50-200 m/s, is significantly lower than muzzle velocity, which is usually 300-1000 m/s, but the velocity is still high enough to kill.
Celebratory gunfire - plenty of statistics and examples. My favourite: "every bullet that is fired up, must come down".
People are injured, sometimes fatally, when bullets discharged into the air fall back down. The mortality rate among those struck by falling bullets is about 32%, compared with about 2% to 6% normally associated with gunshot wounds. The higher mortality is related to the higher incidence of head wounds from falling bullets.
For example, in one study led by the U.S. Centers for Disease Control and Prevention (CDC), they found that 80% of celebratory gunfire-related injuries are to the head, feet, and shoulders. In the U.S. Commonwealth of Puerto Rico, about two people die and about 25 more are injured each year from celebratory gunfire on New Year's Eve, the CDC says. Between the years of 1985 and 1992, doctors at the King/Drew Medical Center in Los Angeles, California, treated some 118 people for random falling-bullet injuries. Thirty-eight Kuwaitis celebrating in 1991 at the end of the Gulf War by firing weapons into the air caused 20 deaths from falling bullets.
Firearms expert Julian Hatcher has studied falling bullets and found that on average .30 caliber rounds reach terminal velocities of 300 feet per second (90 m/s) and larger .50 caliber bullets have a terminal velocity of 500 feet per second (150 m/s). A bullet traveling at only 150 feet per second (46 m/s) to 170 feet per second (52 m/s) can easily penetrate human skin and at 200 feet per second (60 m/s), that same bullet can penetrate the skull. Even a bullet that does not penetrate the skull may still result in an intracranial injury.